I recently attended the TransUnion Third Party Conference in San Diego, hosted by Peter Ghiselli and team. It was a content-rich and highly engaging event. Some of the topics covered included segmentation, investment in innovation, a case study on right party contact, predictive modeling, inventory prioritization and much more.
It was an honor to be a presenter and share the latest industry highlights. Topics included the most monumental court rulings affecting how we operate, as well as updates on the Bureau of Consumer Financial Protection (BCFP), emerging trends, innovation and robocall blocking/labeling.
Below are a few highlights of what I covered:
In the courts
Revocation - The particular matter at the center of the revocation debate relates to the consumer’s right to unilaterally revoke consent when consent is covered in a contract signed by both parties. Over the last year there has been a jurisdictional split on whether or not unilateral revocation can occur.
Dialers - ACA International v. FCC, 885 F. 3d 687 (D.C. Cir. 2018) reversed the TCPA expansion caused by the FCC's 2015 declaratory ruling, specifically as it relates to the definition of an Automated Telephone Dialing System (ATDS). The 2015 ruling stated that anything that currently has the capability to dial randomly generated numbers or that has the potential to be modified to allow such capability is an ATDS. This ruling removed the "potential capability" portion from the definition. A summary can be found here.
E-SIGN - Lavallee v. Med-1 Solutions, LLC (Case No. 1-15-cv-1922, U.S.D.C., S.D. Indiana). The BCFP filed an amicus brief in this case stating that the E-SIGN act applies to FDCPA-required disclosures like the 1692g validation notice. This adds a bit of a hiccup to the ability to email collection letters to consumers as E-SIGN requires consent to receive specific items via email.
In addition to the latest court rulings, I covered the work insideARM has led through our Consumer Relations Consortium (CRC) with the BCFP and consumer advocates to advance the industry’s position on third party disclosure, robocall blocking/labeling, proposed rules and more.
Investing in technology and emerging trends is as much about preparing to weather future storms, as it is about optimizing current performance. Another downturn is inevitable and the firms that can make quick, fact-based decisions and have alternate low-cost channels, will more quickly pull the levers needed to scale and meet customer demands.
A strong data infrastructure, fact-based decision making and a blended omni-channel engagement strategy will be differentiators in the near future.
- Investing in data and strategy gives you the ability to quantifiably measure ROI, provided a strong test and control strategy (A/B testing) are in place at the time of deployment.
- Expanded contact channels is a must have on your strategic investment plan. It’s what an increasing number of customers want and it’s considerably cheaper than traditional voice channels. These are lower cost levers that can be pulled to augment staffing, increase intensity and improve contact with customers.
Companies that are risk averse and slow to adopt these new communication channels like self-service IVR’s, text, email, virtual agents, may struggle to compete if the industry sees stress like we did during the last economic crisis.
The Consumer Relations Consortium (CRC), led by insideARM, is a membership group of 200+ leaders from top creditors and agencies. The group focuses on innovation, compliance and process improvement.
This year, we launched a Better Way project following our completion of an in-depth innovation assessment in the early spring. The four categories assessed included: 1) Bridging the Gap, 2) Substantiation 3) Big Data and 4) Data Standards. Bridging the gap was identified as the top priority, with a focus on improving the hand-off between creditors and agencies in a way that will more quickly build trust and expedite recoveries for agencies and consumers. Projects underway in this area include:
Third Party Consent Management - an end to end process assessment was completed and documented to help creditors and agencies find the most efficient and compliant way to pass consent back and forth at the the time of and throughout the placement period.
Handshake Letter - deploying an industry test to validate the quantifiable value of creditors providing an initial notice to consumers notifying them that their account is being placed with a third party collection agency (including name, contact info, etc.). This is intended to build trust by helping consumers to recognize the agency contacting them on the creditor’s behalf.
Robocall Screening - select CRC members, in conjunction with Numeracle, a member of our innovation council, are participating in a test to measure the benefit of things like registering numbers with the various analytics companies, and running tests to determine the extent to which the company’s calls are being blocked and/or labeled.
Third Party Disclosure - work is underway to develop a standard, fully deployable third party disclosure notice, information about the consumer’s account status at the time of placement with an agency.
Special Topic - Robocall Blocking/Labeling
In response to the $9.5 billion scammed from 22.1 million Americans, the FCC and FTC have given approval to carriers and other industry players to block and label calls. The primary action to date has been for telecom companies to hire analytics firms to write models to systemically differentiate a good call from a bad call. Despite their efforts, legitimate call orgininators such as Fortune 1500 companies have seen a 20% reduction in contact rates. This has resulted in revenue loss to which they have no control or visibility to stop.
The CRC has dug in to the topic of robocall blocking and is playing an active role in contributing to a solution that will mitigate the risk to our industry’s ability to successfully contact customers over the phone. The CRC recently hosted a roundtable with consumer advocates, regulators, telecom companies and the various technology firms involved to convey the unique challenges call labeling poses to the collections industry.. It’s important that we have a voice at the table to ensure that the solution to this problem doesn’t have unintended consequences on our ability to contact customers.
The telecom industry is also working to develop a program called SHAKEN/STIR. The concept consists of a digital certificate that travels with the call from originating to delivering carrier to verify that the calling number is owned by the caller and hasn’t been spoofed. The group has completed much of the technology solution, and is now working on the process side of how certificates will be issued, who can issue them, etc.. The ability to identify a spoofed caller ID is core to re-establishing trust in the call channel.
The telecom industry, in conjunction with groups like insideARM, PACE and engaged tech companies are working together to identify short and long term solutions to this quickly evolving problem.
There’s no shortage of movement happening in the collections industry. The key is to stay in the know on how to remain compliant, while also pushing the envelope to remove barriers and continue advancing in low cost, customer friendly, innovative ways.