Fintech launches portal to let consumers negotiate debt issues with banks
TrueAccord, a fintech that has developed software allowing banks to negotiate debt payments with distressed borrowers, is launching a direct-to-consumer portal called Engage.
TrueAccord operates in a countercyclical business that’s growing as most business is slowing and many companies are shutting down. It already works with several large U.S. banks that prefer not to disclose the relationship.
As job losses rack up, it seemed like a good time to let borrowers reach out to any lender to adjust terms of repayment, including deferments.
“If you offer a lot of flexibility to a lot of people, you’re going to collect more,” said Ohad Samet, TrueAccord's CEO. “That’s the gist of Engage: Don't feel judged, feel empowered.”
The idea came from borrowers who had three or more debts. They used TrueAccord with one lender and wanted to use it with others, he said.
If a user is trying to negotiate with a bank that doesn’t work with TrueAccord, the software firm will send a request for relief to the bank by email or letter.
Engage can be used to delay payments on performing debt, as well as credit that’s already gone into collections.
“Until now we were focused only on collections, but now with COVID-19, we're hearing from consumers that they need a digital way to contact their collectors and creditors,” Samet said.
TrueAccord can facilitate a repayment negotiation through email, paper letters and text messages. But email is most common.
“Email is the main channel we use because it's so good for disclosures and for explaining to people what the situation is, we rarely need to send a text, call or send a letter,” Samet said.
TrueAccord also uses artificial intelligence to strike the right tone communicating with borrowers.
“We have a patented, homegrown machine-learning-based engine that decides based on debts and the consumer's behavior who to contact within what timeframe, on what channel, email, text or phone call, and what content to use,” Samet said.
TrueAccord tracks the way people respond to its communications and continuously adjusts its messaging.
Engage has been in development for over a year and there are more than 46,000 consumers and hundreds of collectors using the platform, the company said.