Online Resources Offers Options for Clients and Debtors

(This story is Part II covering Online Resources Corp. of insideARM’s series on online collections program.)

Online Resources’ Virtual Collection Agent online debt collection technology is designed as a “self-curing” application, according to Bill Kinnelly, the company’s senior vice president of marketing for e-commerce services.

One of the major differences between Online Resources’ (Nasdaq: ORCC) product and competitors on the market, according to Kinnelly, is the education component. The VCA offers links to content such as bankruptcy education that the customer (credit card firm, collection agency, etc.) defines to help the debtor understand the implications of potential actions (such as filing bankruptcy). While some lawyers or financial advisors might tout bankruptcy via various marketing efforts, the education offered through Virtual Collection Agent provides pros and cons of such an action, Kinnelly said.

Similarly, a credit education link helps debtors better understand credit decisions and how to manage their payment obligations. The idea is that a better educated consumer is more likely to pay his obligations and less likely to walk away from an unpaid obligation to the Online Resources client.

To interact with VCA, a debtor goes to the online application, enters his log-on information, and then proceeds to the budget calculator page to enter his financial information such as monthly income and itemized expenses such as rent/mortgage, utilities, auto payments and so on.

The next page provides an account summary, with tabs for making an immediate payment, noting that a payment has been sent, “I plan to make a payment soon,” and “I’m having trouble making a payment.”

Those who are pre-qualified for settlement offers will have a message waiting on the account summary page. Any settlement offer is determined by the creditor company client of Online Resources. The client can view and tweak the settlement rules via a decision tree visible on its side of the application.

A debtor planning to make an immediate payment clicks the appropriate tag, taking him to the payments page, where he can make an electronic payment via check, payment card or wire.

Those who plan to send or who have sent a payment are asked to provide information regarding the date it was or will be sent. Those who are having a problem making a payment will go to a page to try to work on an alternative plan.

The alternative payment pages offer a debtor a selection of choices, including payment in full, a minimum amount, ‘other’ and possibly more alternatives. In some instances, the debtor may have the ability to choose to send in more than the minimum. A creditor has the ability to allow the debtor to pay less than the listed minimum, though it’s more common that the collector will require an automated rejection of any offer less than the minimum.

The payment program workout takes the debtor through a survey, which concludes by offering several payment options depending on the debtor’s responses. For example, a debtor who says he can’t pay because he lost his job can be given easier terms compared with the debtor who can’t pay because he’s overextended on his credit. These offers are determined by the Online Resources’ client.