Collection efforts by businesses often damage customer relationships with negative communications tactics, according to a survey of 1,000 respondents commissioned by Nuance. The survey found that nearly 70% of consumers have had a negative experience around collections.
The most common complaints from consumers include:
· being called constantly - more than a dozen times in a day - 43%
· being asked to pay a debt that they dont actually owe - 22%
· threatened with legal action - 38%
"Debt collection has a significant impact on the bottom line for most U.S. businesses with many writing off losses every quarter when customers dont pay bills. With new rules being considered by the Consumer Financial Protection Bureau on the horizon, paying attention to the customer experience is becoming more vital to being able to collect on unpaid debt," said Robert Weideman, executive vice president and general manager, Enterprise Division, Nuance.
The research found that nearly half (48%) of Americans admit that they have not paid a bill on time in the past 12 months. Research indicates that businesses need to adjust their strategies to proactively reach customers about their debt and respond to customer inquiries appropriately.
For example, 73% of consumers believe a proactive reminder to pay a bill could have helped them to avoid a late fee in the past.
The research also reveals guidelines on how companies can create a better experience for consumers:
· Call at the right time: Consumers report they are open to calls at all times of the day about an overdue bill. But, to accommodate the majority, companies should employ the general rule of calling between 9 a.m. and 9 p.m. based on where consumers are located.
· Attempt to call at least eight times: Existing regulations dictate that companies must make attempts to reach customers before sending an account to a collections agency. On average, consumers report that companies should try to contact them eight times.
· Leave a message: The Fair Debt Collections Practices Act states that collectors cannot disclose that a communication concerns a debt to anyone but the debtor. At the same time, it requires that every communication makes clear it is a collection attempt. So, can companies leave voicemails? Sixty-six percent of respondents agree that companies should be permitted to leave them detailed voice messages.
· Provide a choice: The majority of consumers (87%) believe they should be able to pick the communication channels they prefer companies use to contact them.
· Allow limitations: Additionally, consumers also want the freedom to restrict outreach. 82% believe they should be able to limit the communications channels companies can use.
"The research makes it clear that consumers expect companies to engage with them about unpaid bills but, they are unsatisfied with the current customer experience," said Weideman.
About the Research:
The survey, commissioned by Nuance, was conducted in January by Wakefield Research, an independent research firm. It surveyed 1,000 nationally representative U.S. adults aged 18 years and older.