There are three main areas that collections managers have to concern themselves with when receiving a new placement to work: compliance considerations, contact information and ability to pay.
The compliance considerations include but are not limited to:
- Is the consumer filing or has the consumer filed for bankruptcy protection, and if so, is this particular debt covered by that bankruptcy?
- Has the consumer died?
- Has the consumer previously filed complaints in the courts alleging a violation of one of the many laws protecting the public?
- Are there active-duty military considerations to be cautious about?
In addition to checking for these considerations when first receiving the placement, the professional collector also has to continue checking for these situations as long as they he or she is trying to collect on the debt.
This leads us to the next consideration of contact information.
- Did the placement include current accurate contact information such as phone number(s) and address?
- Even if a provided phone number is current, is it properly identified as a cell phone? We are all aware of the cottage industry that has sprung up for suing for Telephone Consumer Protection Act (TCPA) violations.
Finally, what is the consumers ability or likelihood to make a payment given that all compliance hurdles have been cleared and good contact information is known? You are probably aware of several scores available for collections, many of which are tailored to specific debt types. Depending on likelihood of payment, this may well impact what type of activity you apply to a debt including how much you can profitably spend both for third-party data as well as work efforts.
A Different Way
When bringing together compliance, skip tracing (contact) and ability-to-pay information, the conventional process has been to provide one to three separate passes against third-party vendors. Pass one typically includes scrubbing the accounts for bankruptcies and deaths, which typically would take one or more days to process, including sending the file to a third party and then receiving back the results and loading them into your collections system.
Pass two sends the file to another data supplier searching for fresh contact information at the expense of another one to two day delay. Finally, pass three may involve sending the balance of the file to a third vendor that has sufficient credit information about the consumer in order to build a sufficiently predictable score. Altogether, the total process may take a week or more elapsed time plus the need to build interfaces to multiple outside vendors.
The next generation of workflow interfaces will allow for one-stop data retrieval based on your workflow needs, thereby saving time and quite possibly third-party data spend. As an example, consider the following questions:
- If my consumer has filed bankruptcy or has died, do I still want contact information?
- If I dont have new contact information, do I care what their collectability score is?
- Conversely, if their collectability score isnt high enough, do I care about paying for a new address or phone?
All of the above considerations, while not an exhaustive list, will factor into the workflow processes that you execute. Next-generation interfaces, now coming into the market, will allow for building scenarios involving a single file transfer that will process the file immediately and:
- Scrub for compliance information and, if compliance considerations are found, proceed no further with requesting scores or new contact information.
- Score the account for ability to pay and use your unique logic to determine additional data needs, such as new contact information and credit attributes.
- Scrub for new contact information and then conditionally return compliance or scoring data.
- Pass accounts onto monitoring processes for event triggers if other hurdles are encountered.
The point is not to push a particular workflow sequence but to get the collections manager thinking about new approaches whereby smart workflow decisions can be built into the third-party retrieval process to reduce system interfaces, collapse elapsed times for retrieving all necessary data points, and allow flexibility or changing workflow sequences based upon current results. Doing this will optimize your data spend.
Rollin Girulat is the Senior Collections Product Marketing Manager at Experian.
