Collections technology strategies discussed at latest Think Tank

23rd September 2021

Credit Connect’s hosted its third Online Collections Technology Think Tank 2.1 last week which saw the discussions focused upon collections strategy as we prepare to start to feel the impact of the pandemic and Brexit.

Fourteen collections professionals from a variety of industry sectors joined the discussion on business transformation, customer engagement, affordability, vulnerability and open banking in collections.

The insights from the event were recorded and now can be viewed by clicking on this link.

Over 200 collections professionals from banks, building societies, motor finance, utility firms,  local authorities, telecoms, media, debt collection agencies, and fintechs were amongst the viewers across the four sessions.

Commenting on the event host and Chair Colin White Founding Director at Credit Connect said “It was really interesting to hear the views and approaches different companies have used during the pandemic and to hear their views on future collections strategies.”

“We have had some great feedback and questions from the attendees during the event, there were a couple of debates which could have continued longer so I am pleased that we can gather some more views from the collections communities at the face to face Credit & Collections Technology Think Tank in November. In addition, in 2022, we fully intend to continue to run this online series as well.”

Commenting on the event panellist Jim Appleby, Managing Director at Arrow Global said ”It was great to be involved in the Technology Think Tank, really interesting to hear that all stakeholders (Creditors / BPO Providers / Tech providers) all see the future model to support vulnerable customers in a similar manner.  It was even more interesting to see case studies unpacked showing tangible value already being driven from these progressive models of blended outsourcing with creditors taking advantage of specialists to accelerate customer support.  I am really looking forward to seeing these models develop over the short term”

Denies Crossley, CEO at Lantern said “ I thoroughly enjoyed contributing to the Think Tank discussions centred around Affordability in Collections alongside Alex and Frank.  Managing customers in collections in the right way is essential to ensure good customer journeys and outcomes.  Not only does it enhance engagement but it reduces complaints, whilst increasing repayments where appropriate, allowing the customer to find their way out of debt in a dignified manner. This is something played out on a daily basis at Lantern, and I’m always very happy to share best practice.  I’d like to thank Credit Connect for inviting me onto the panel.”

Alex Woodcraft from GAIN Credit said “ I had a fantastic time discussing affordability in collections with the Denise and Frank. This discussion was very important as we focused on how we can make sure we get it right in Collections. This is something that we take very seriously in GAIN Credit and I’m proud of what we’ve delivered in this space. I want to thank Colin and the Credit Connect team for having me on and look forward to joining future discussions.”

Many of the discussions covered at this event will be continued at the Credit & Collections Technology Think Tank will take place face to face in Manchester on Thursday 4th November at the Midland hotel. The agenda for the event can be found here.

The event will be followed by the 2021 Credit & Collections Technology Award ceremony which will take place in the evening at the Midland Hotel, Manchester. Interested attendees can view the costs to attend one or both events by clicking here.

If you are interested in speaking or becoming a sponsor for the next event then call 01622 437014 or email events@credit-connect.co.uk for more information. More online events will be confirmed soon.

The Online Collections Technology Think Tank series will return in 2022. Dates will be confirmed soon.

*The event was kindly supported by Webio,  CallMiner, Paylink Solutions, Ophelos and Ceverine.


Event Questions round-up

Responses to questions:

  • As consumers increasingly move away from traditional methods of communication to more social media apps how does the panel feel about the use of these channels within collections and is communicating by non-business apps such as Whatsapp or Snapchat crossing the line of contacting a consumer about “a personal business matter”?

Amon Ghaiumy at Ophelos: Ultimately it does not matter what we perceive as non-business channels or apps, but rather what the customer wants. If the customer prefers to get contacted on WhatsApp for collections matters, then we should be able to contact the customer on WhatsApp. It’s therefore important to have the technology infrastructure in place to support different channels, based on customer preference. 

Generally speaking, channels like WhatsApp, Apple Business Chat, Google RCS, etc. are being used more and more for general customer support/service conversations as well as for sales and marketing conversations by many different industries (financial services, telcos, travel, etc.). I don’t see why the collections industry would or should not adopt these channels too. 

  • What technology will improve Collections productivity and what is a healthy target for the cost to collect as a ratio/%? 

Amon Ghaiumy at Ophelos: In my view, there is not one single technology that will massively improve productivity. It has to be a combination of a foundational technology stack that supports digital customer journeys, automates outbound communications, augments customer service staff and gathers data from both customers and agents in the right way to drive automation in different aspects of the operation through machine learning. If these are implemented correctly, this can drive down the cost to collect massively. There are ways to get to his point faster, by working with a specialized organisation that has already implemented all the different aspects into their own operation (such as Ophelos).

  • What is the role of data and deep machine learning for future Collections?

Amon Ghaiumy at Ophelos: It will play the single most important role in the future of collections. Machine learning will be the driver towards better liquidation and recovery results, as well as significantly drive down operational costs, because it will allow us to detect success patterns in our processes that are/have been unaware of and will allow us to optimise our operation towards those patterns.

  • How do firms, like Ophelos, help financially vulnerable consumers who are in arrears with priority debts and live with a deficit budget?

Amon Ghaiumy at Ophelos:  We help customers in many different ways. It starts with earlier and more accurate detection of a vulnerability in the first place. We use machine learning to better detect vulnerable customers and then augment our customer support staff so they can make sure that vulnerable customers are supported in the appropriate way. 

We have also built very easy to understand and intuitive digital journeys, that allow customers to easily set up repayment plans, do fully digital affordability assessments or simply chat with us online. We are also building out more customer-facing products, such as PMF tools, calculators and financial education content. 

  • We talk a lot about digital, but in terms of customer journeys but are we going to have to solve new customer problems and outcomes.  Is digital creating new ways to get to the same outcomes or do we need to think about more fundamental tools and processes as a result of the pandemic?

Amon Ghaiumy at Ophelos: The short answer is yes, we have to start thinking about transformation in this industry on a more fundamental level. The pandemic is a catalyst, but to be honest, even without the pandemic ever happening we would’ve had to face the fact that the collections industry is years behind other industries in the adoption of digital tools. 

It is important to consider that we are not trying to drive digital adoption for the sake of driving digital adoption. Customers want to engage digitally within collections. And ultimately we have a responsibility to act customer-centric and allow customers to solve any question or issue quickly and without friction. Digital is the best way to enable exactly that.

  • Given the individuals with physical and mental health vulnerabilities have a significantly increased propensity to be financially vulnerable, what do you see as being providers responsibility to proactively identifying and supporting these customers, and how can this be done?

Alex Woodcraft, GAIN Credit: Vulnerabilities of this nature tend to have a stigma attached, so encouraging customers by showing them how you can help or by sharing case studies of how you’ve helped customers in similar situations is vital. You should make it clear to customers that there isn’t any judgement and all you want to do as a lender is help them. Ultimately it is the customer’s choice to disclose this information, but extending our support slowly helps to reach out to more vulnerable consumers.

  • What will make the difference to get lenders to sign up to share I&E data more widely so a customer only has to do one I&E?–

Alex Woodcraft, GAIN Credit:  I think we’re closer than you might think. We just need an agreed standard. Certainly, we would welcome this as it will make life easier for customers and reduce the mental load when talking to their creditors. Could the breathing space infrastructure be used here?

  • How does technology help with the identification of vulnerability specifically? does it use keywords spotting or emotion measurement or both?

Alex Woodcraft, GAIN Credit: Speech analytics and ‘wordscrubs’ that search for key vulnerable words and phrases in advisor notes, chats & emails are great for identifying vulnerability where a customer has started to disclose their circumstances and can act as great controls in ensuring agents are identifying these disclosures and providing the appropriate support.  Some speech analytic tools have started looking into emotional measurements, talk overtimes, pause times, increased volume of conversation as well as emotional language and word association.  More needs to be done in picking up on behavioural triggers that may indicate vulnerability.  We are learning more and more about how technology can be used to monitor a customer’s system behaviour through digital channels, idle times, speed of which a customer flows through a journey, hover times over certain fields, typing then deleting can all be indicators that a customer may require additional support.

  • What is the panel’s experience using Open Banking and CAR API’s for automating IE data gathering and SFS production?

Andrew Alder Paylink Solutions: Around 30,000 self-serve IE assessments are carried out across Paylink Solutions’ client base each month. An average of 60% of customers have accessed Open Banking and CRA APIs to pre-populate their SFS budgets so far as part of the journey. This reinforces our consumer research that indicates more than 50% of customers would not complete the self-serve journey if OB and CRA was not available.

Angus Clacher from CreditKudos: (CK) does this for just over 100 brokers, lenders, collection agencies and software providers. CK provides the customer journey that the applicant goes on (product name Connect Flow) and allows manual review of the IE in either a SFS PDF or an interactive Dashboard (product name Atlas) and allows clients to automate their processes with an OB policy decision & workflow engine (product name Assembly)  For automated decisioning and processing at scale an API is used (product name Reports API)
  • Payment suitability is a massive challenge, some reports suggest that 1 in 3 payment plans fail within 90 days, is the market going to see an increasing adoption of open banking technologies to improve sustainability/ affordability?

Andrew Alder Paylink Solutions: Improving payment arrangement kept rates is one of the main reasons why lenders adopted Open Banking in the first place. Open Banking data from our creditor clients shows the sustainability rate of customer payment arrangements has already improved by an average of 15%.

Angus Clacher from CreditKudos: We have been told that using OB found an additional £35 pounds per week available to pay down debts and an automated IE resulted in an 8% higher PTP kept rate. (Promise to Pay kept rate)
  • How do you provide assurance that OB data is accurate without lengthening time spent reviewing information pushed through from OB request?

Andrew Alder Paylink Solutions: Around 30,000 self-serve IE assessments are carried out across Paylink Solutions’ client base each month. An average of 60% of customers have accessed Open Banking and CRA APIs to pre-populate their SFS budgets so far as part of the journey. This reinforces our consumer research that indicates more than 50% of customers would not complete the self-serve journey if OB and CRA was not available.

Angus Clacher from CreditKudos: OB data can pre-populate an IE in 10 seconds and be shared with customers. Customers only need to challenge the OB data they don’t agree with rather than laboriously entering or communicating each field.
  • What do you see as the main customer benefit with Open Banking?
Angus Clacher from CreditKudos: It’s much faster, easier, less stressful and more accurate for the customer to share their details via OB, than to fill in forms or go through a conversation with an agent. 59% of clients who went through the collections customer journey with Paylink one of our clients rated it 5 stars.

Selected Event Poll Results

In your opinion which method of customer engagement generates the best results?

  • Phone 23%
  • Letter 5%
  • Email 15 %
  • SMS Texts 36%
  • Multi-media messages 16%
  • Other 5%

What is the most challenging part of being in customer service?

  • Dealing with Data 28%
  • Dealing with Angry customers 22%
  • Chasing customers who ghost out during collections 44%
  • Refusing credit to customers 6%

How has the pandemic era impacted your collections performance?

  • Our collections rates have dropped 31%
  • Our collections rates are better 19%
  • Our collections rates are about the same 44%
  • Our collections rates are the best they have ever been 6%

How do you measure the effectiveness of your collector calls?

  • Random sampling with manual listening and assessment 33%
  • Targeted sampling with manual listening and assessment 45%
  • Voice of customer surveys or post call surveys 11%
  • Interaction/ conversation analytics (for all calls irrespective of outcomes) 11%

On average, how much time do you think is saved in your business by using Open Banking technology as part of the collections process?

  • I don’t think this saves time – 15%
  • Up to 10per cent – 31%
  • Up to 25per cent  – 23%
  • Up to 50per cent – 31%

What do you see as the main customer benefit with Open Banking?

  • Time-saving 38%
  • Greater accuracy 43%
  • Customer experience 14%
  • Confidence in budget 5%

Do you currently use Open Banking in your product or do you plan to?

  • Yes-we do currently 35%
  • No-but we plan to 41%
  • No-and were not planning to 24%

* ALL EVENT DATA AND POLL RESULTS ARE COPYRIGHTED TO CREDIT CONNECT MEDIA  AND SHOULD NOT BE USED OR SHARED WITHOUT OUR PERMISSION