To fully leverage the potential of automated contacts to mobile devices, collections organisations need finely targeted, even customer-specific communications strategies. Analytics, business rules and workflows should be used not only to segment delinquent populations based on credit risk, but also to determine which channels and sequence of actions are most likely to be effective based on the customer risk profile, customer preference and results of past contacts.
Cultivate relationships when customers aren't delinquent
Increasingly, consumers go to social networks for advice on choosing service providers, and to air complaints when dissatisfied or feeling harassed by collectors. This is especially relevant in Singapore, where seven out of 10 Singaporeans use mobile phones to interact on social media and 33 percent of Singaporeans use social media to voice criticisms about products and brands, according to a report by Nielsen. Shared experiences and opinions exert a growing influence on others. It's a situation that makes getting collections processes right more important than ever before.
Fortunately, social media also points the way to better collections, by demonstrating the power of relationships. If consumers liberally share information with social network contacts while holding it back from companies they do business with, it's because a relationship exists with the former that may not exist with the latter.
Companies that cultivate relationships with customers when they aren't delinquent are in a better position to collect if they become delinquent. There are opportunities in every industry to stay in touch and be helpful in ways that encourage dialogue - while leveraging these interactions to keep contact records up-to-date.
By building and sustaining relationships, creditors also create more opportunity to prevent serious delinquencies from developing. When analytics spot behaviour patterns in payments and other transactions indicative of increasing financial stress or of probable impending strategic default, collections organisations can intervene with pre-delinquent treatments. Customers who've already been engaged in dialogue are more likely to be receptive to educational information and offers of assistance, and may be predisposed to cooperate.
Many collectors still scoff at the idea that collections are becoming a "customer service" centre, focused on building relationships rather than collecting overdue payments. In fact, the two can go hand-in-hand, and utilising mobile communications technology is the key to success.
Ross McGown is Managing Director - APAC Mobility, FICO.
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