Investing in advanced consumer self-service technology and internal workflow applications can be critically important for companies working to manage the many treatment options available for financially troubled consumers. Each technology can play a key role in choosing the right treatment to keep consumers paying, many collection industry insiders say.
“Loan modifications are choking the collections pipeline because they have created a lot of treatment options lenders can offer distressed customers, but those options tend to involve a lot of manual processes,” Brian Reiss, managing director - US Practice for Bridgeforce Inc., said at the recent National Collections & Credit Risk Conference. “Automating those processes through workflow and self-service technologies can keep collection departments from being overwhelmed by manual processes.”
Investment in workflow applications keeps the process of qualifying a distressed customer for a treatment strategy on track by queuing automated reminders for the next step in the process and sending them to the customer and the agent handling the case.
“Unfortunately, most collection departments and collection agencies don’t have sufficient IT resources to support these new workflow processes,” added Reiss.
Software as a service (SaaS) helps lenders and agencies overcome a lack of IT resources and gain access to current technology at a more affordable price. End users license SaaS applications, which are hosted by a third-party provider, sparing them the upfront capital expenditures of installing the software and the hardware needed to run the application internally.
Ongoing maintenance costs also shift to the service provider. The affordability of SaaS applications mean lenders can be up and running with a cutting edge applications in weeks instead of months.
Because SaaS is available through an on-demand model, applications scale according to load, making the platform less prone to down time or slow downs in performance, which can adversely affect customer interactions through self-service channels, such as the web.
Performance under peak loads is crucial because more distressed consumers are being urged by lenders to use the web to contact them about loan restructuring or initiating a treatment strategy based on their financial situation.
If the site performance is too slow or the site unavailable because of overload, consumers are unlikely to persist in making contact, allowing their financial situation to deteriorate further in the meantime.
“Self-service through the web is part of doing business, especially in this environment,” says Vytas Kisielius, CEO for Collections Marketing Center, a provider of collection services and software platforms. “Distressed customers don’t always want to talk to a live agent and when they do apply for a loan restructuring or treatment plan they tend to get antsy and contact the call center a lot to find out whether they have qualified. Self-service through the web is a way to manage these communications more efficiently.”
CMC’s FlexCollect platform synchronizes debtor communications, settlement offers and treatments via agent- and self-service-based channels, such as the web.
“When lenders can synchronize communications with workflow processes, they can give customers access to self-service channels that provide real-time visibility into the status of their case, which shifts a lot of the in-bound communication load off of the call center,” says Kisielius.
The web is a self-service channel that lenders can use in a variety of ways to communicate with financially distressed customers.
Discover Financial Services is using the web to educate consumers about to how to manage their credit. Discover is a co-sponsor of HelpWithMyCredit.com, a site created by credit card issuers and payment networks to raise awareness and educate consumers about options to manage their credit.
“The information on HelpWithMyCredit.com has helped people figure out their options in a self-service environment, which some consumers prefer,” says Brianna Elsass, manager of the Consumer Self-Service Channel at Discover. “We have found the self-service channel to be a successful way of interacting with customers.”
Not all consumers want to use self-service channels, however, which is why lenders still rely on outreach programs through automated voice response units. Even though [Interactive Voice Response] IVRs are a mature technology, proactive outreach through them is critical, because the technology can be used to offer gentle reminders that a payment is due.
IVRs also can be used to keep workflows on track by proactively contacting customers to remind them that the deadline for information needed to qualify for a loan restructuring is approaching and the needed information has not been received.
“Automated, proactive outreach keeps workflow processes moving forward,” according to Reiss. “With automated systems, lenders can build escalation queues that kick in on predetermined dates and ensure that contact with the customer is maintained, which is key is to qualifying a distressed customer for a restructuring program. Lenders don’t want the contact with the customer to fall through the cracks.”
Conducting consumer outreach through IVRs also provides distressed customers an option to speak to a live agent if their situation has changed.
“In this environment, lenders need to proactively reach out to customers to keep them on track with the treatment process and at the same time offer an opportunity to speak to a live agent if they feel the need to,” says Elsass.
Outreach messages must clearly state the intent of the call and offer available options to be effective.
“There is no way to know in advance if a customer’s situation has changed, so options to speak to a live agent have to be clearly presented,” says Elsass. “The call could be a friendly payment reminder to a non-delinquent customer that has suddenly become financially stressed and would welcome the opportunity to speak to an agent.”
With fallout from the recession expected to continue taking a financial toll on consumers who have yet to become delinquent on loans for the foreseeable future, lenders and agencies that fail to automate their consumer communications and internal workflows are apt to become overwhelmed by manual customer interactions and miss opportunities to get distressed consumers on the right treatment strategy and keep them on track.
Says Kisielius, “Collection managers who can’t get their department out from under the increasing work load because they lack the technology to do so won’t be able to manage the lifecycle and workflow of the treatment strategy.”
