The COVID-19 pandemic created unprecedented challenges for the debt collections industry, including new regulatory rules, changing consumer demands, and a potential uptick in activity as forbearance nears an end and deferments fall off. The pandemic continues to affect everyone’s lives, and — along with inflation and market fluctuations — the only thing that’s certain is continued uncertainty. As lenders and third-party collections agencies plan their next steps, a robust evaluation of debt-recovery processes should be a required starting place.

In such uncharted territory, the more tools you can deploy and optimize, the greater your chances for high rates of return. Therefore, leveraging the best data and analytics on the market — paired with innovative solutions — are essential for your collections roadmap. Using data to automate and streamline — while strengthening your risk-identification and mitigation approach — can set you on the right path.

Your comprehensive strategy should focus on the following areas: 

  • Leveraging the best data and digital solutions available
  • Increasing agility in your end-to-end debt management process
  • Using tools and services that keep you abreast of regulatory developments 
Customizing your approach can help minimize loss, optimize resources and maintain relationships, so you can collect debts faster and improve cash flow. Superior data and analytics provide a more comprehensive consumer view, which can lead to higher recovery rates, when deployed tactically across the collections lifecycle. To do that, let’s expand on the concepts above.


Access the best data and digital technology

Data providers have a broad range of digital solutions created exclusively for the collections industry and its unique needs at every phase of the collections journey. For instance, collection-management software, skip-tracing and contact-information tools using advanced analytics can help identify, prioritize and assist with contacting and communicating with consumers. Pair these with other digital options that help treat and monitor, and you can evolve your collections processes to be as frictionless as possible for both your staff and consumers. 

Solutions that provide optimum visibility into consumers’ overall financial picture can bolster risk-management efforts. The deeper your consumer view, the stronger your prioritization insights. When you better understand and meet consumer needs, you can intervene earlier to prevent delinquency and collect greater amounts. 

With the proliferation of digital devices, contacting consumers at the right time, through the right channel, can improve their experience and increase likelihood of cooperation. Collections should be viewed as an omnichannel opportunity that can result in better return rates and less stress for the consumer. 

Increased agility in end-to-end debt management brings value

A lack of investment in the latest solutions can leave your business grappling with technology and processes that are severely outdated and leave little room for customization or optimization. Suppose you need to develop new payment or forbearance tools? Or perhaps you need options to help you respond fast to fluctuating market conditions? There are solutions that will help you stay agile and profitable in the face of these variables. 

Solutions that use machine learning and artificial intelligence are transforming how debt is collected, and effectively harnessing these tools is crucial. These technologies can analyze massive amounts of data from diverse sources and deploy algorithms to improve existing processes and capture new insights about delinquency risk and manage vulnerable accounts. Leveraging every advantage available can differentiate you from your competition.

Find options to meet and manage regulatory developments 

One of the greatest challenges for collections is adapting to an ever-evolving regulatory framework. When you can assess emerging vulnerabilities and update policies, you can better respond to market shifts and changing regulatory requirements. Ensure your debt-management strategies are fair and compliant with all regulations and policies in place through the latest solutions. 

From superior data through innovative compliance solutions, an industry partner that provides a range of options across the debt-management lifecycle can help you strengthen your bottom line.

Connect with a partner with best-in-industry data, technology, and in-depth industry experience

The uncertain economic environment continues to impact the collections industry. In the face of continued compliance requirements, changing consumer demands, and an expected uptick in collections volumes, debt-collection departments and agencies are navigating an industry in constant flux. Fortunately, there are opportunities as never before to tap into innovative solutions to minimize challenges and reap advantages as we move into the next phase of our global economy. 

Experian is committed to providing its partners the best solutions available and personalized customer service to optimize your efforts at every phase of the collections lifecycle. Retool your strategies with a trusted, best-in-industry data and analytics partner today to prepare for tomorrow.

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