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Consumers now have the flexibility to resolve debts through digital self-serve channels; data and analytics provide a more personalized and helpful experience
Costa Mesa, Calif., April 19, 2017 ― Getting debt collection right is about more than money. It’s about knowing the difference between a customer who has simply forgotten to make a payment or someone dealing with a financial hardship. Knowing the difference is important so lenders can provide the individualized customer experience consumers expect when they pay bills, secure a new loan online or deal with collections.
Debt collections processes have remained static over the years. The industry-standard has been to follow the risk relying on standalone solutions that weren’t able to manage the entire life cycle. As the lending landscape has evolved, with many new and existing choices to access credit, complexity and costs have evolved as well. Collections costs have grown significantly. According to Federal Reserve, consumers accounted for $29.3 billion in charged-off credit card debt in 2016, a 15 percent increase over 2015. Lenders are trying to adapt to these market changes while managing against potential increases in delinquencies.
Experian® has launched two solutions, eResolve™, and PowerCurve® Collections, to give consumers an easier way to resolve their debt and to streamline the management process for businesses. eResolve is the first self-service platform to help consumers negotiate and resolve past due obligations while PowerCurve Collections brings together data, decisions, and the collections workflow in a single, unified system.
“We have to move debt collections into the modern age,” said Craig Boundy, chief executive officer, Experian North America. “Using our data and analytics, lenders can uncover the best way to personalize the collections process to improve the customer experience and simplify debt management. The advanced, data-driven decisioning we offer can prepare lenders against rising delinquencies, while increasing the long-term value of their customers.”
Helping consumers ease the debt process
eResolve is the first self-service platform that acts as a virtual negotiator for consumers to resolve their debt obligations. Through digital mediums, lenders can offer consumers options for payments, payment dates and the ability to negotiate terms without interacting with a collector. This tailored approach helps eliminate aggressive collections tactics so lenders can build trust through convenience. It also reduces lender costs, increases returns and improves the overall consumer experience while elevating the collections process into the modern age.
Making the process of debt collection easier for businesses
PowerCurve Collections gives lenders an end-to-end debt management process with insights to inform their actions. Every contact with a customer is an opportunity to strengthen the relationship, and PowerCurve Collections can drive decisions like how often to contact customers and the most effective way – and times - to reach them. The best action could be a high-touch outreach or an automated effort that connects customers to a virtual platform to negotiate their debt. Sometimes doing nothing is the right approach, and understanding which customers are most likely to pay on their own is critical to that decision. PowerCurve Collections can handle these actions easily using a cost-effective collections process that focuses on customer satisfaction.
“Banks are faced with managing multiple collections systems … and want to consolidate these systems into one integrated system. The cost to service a delinquent loan was eight times the cost of servicing a performing loan,” said Craig Focardi, principal executive advisor at CEB, now part of Gartner. “Client interaction is expected to increase across collections, loss mitigation, and foreclosure processes which leads to more costly interactions. Failure to provide better service may result in a loss of customer lifetime value. When successful, loan collections helps retain customers to extend the customer lifecycle and cross-sell additional products.”
These new solutions complement the existing suite of Experian’s origination and customer management solutions that refine debt management and improve collections performance.
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