FIVE WAYS A MANAGED SERVICE COLLECTIONS AND RECOVERIES APPROACH CAN POSITIVELY ENGAGE YOUR CUSTOMERS TO SUCCESSFULLY RECOVER DEBT.

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A managed service model offers credit providers such as banks, retailers and utilities a number of advantages over the development of an in-house collections and recovery approach – here’s how it can put your customer at the heart of your strategy

Knowing your customer can mean many things. In the context of collections and recoveries conducted through a managed service model, it means knowing as much as you can.

KNOW YOUR CUSTOMER

A MANAGED SERVICE PROVIDER (MSP) RECEIVES CUSTOMER DATA FROM THE CREDIT PROVIDER AND THEN ENHANCES AND ENRICHES IT.

To do so, it draws upon all available sources of internal

and external data. It is able to draw upon a wealth of

information that it holds itself and that is held by its

panel of partner debt collection agencies (DCAs).

Such rich data enables the MSP to pinpoint, with a good deal of precision, the best way to go about collecting the debt.

This will be determined by the nature of the debt, its age and the geographical location of the customer among other aspects.

Its approach will also be determined by regulation and compliance.

KNOWING IS UNDERSTANDING

PLACING THE CUSTOMER FRONT AND CENTRE AND TREATING THEM FAIRLY WILL MEET THE COMPLIANCE OBLIGATIONS OF THE FCA’S CONSUMER CREDIT SOURCEBOOK IN RELATION TO ARREARS, DEFAULT AND RECOVERY.

An important part of the MSP’s role is selection of DCAs to fulfil the collection role.

It does this by selecting suitable partners from its panel. For example, a MSP can provide access to many different DCAs and select the right one on the basis of their strengths and capabilities in collecting debts of particular types. They may have knowledge and experience of specific markets, geographical areas and certain asset types.

WHO BEST TO DO THE JOB?

Collections and recoveries is always a work in progress. Monitoring DCA activity and customer performance in detail across an overdue debt portfolio ensures that the credit provider will be fully briefed at all times. This is achieved through real-time dashboard reporting.

WORK IN PROGRESS AND RESULTS

IF ADJUSTMENTS TO THE COLLECTIONS AND RECOVERIES APPROACH NEED TO BE MADE, THEY CAN EASILY BE IMPLEMENTED BY THE MSP WHO CAN SUGGEST ALTERNATIVES.

Uppermost in the minds of the client, the MSP and the DCA is customer engagement.

Each communication with the customer is an attempt to recover the debt but it is also an opportunity to positively engage with that customer.

COMMUNICATIONS

Nothing will be achieved by alienating a customer and this

might well fall foul of regulation in any case. Rather, a great

deal can be gained from cementing the creditor-customer

relationship with each helpful, sensitive contact.

What does success look like?

Of course it includes collection of the overdue account but it achieves so much more through customer rehabilitation.

A reformed and mutually beneficial relationship between customer and credit provider opens the door to future business.

OUTCOMES

RESULTS

In a nutshell the results are:

Reduction of outstanding debts

Write back of provisions

Less capital impact

High level of compliance

Customer engagement and

rehabilitation

Potential new business opportunities

Saving in the cost of customer

acquisition through retention

Overall efficiency in the management of

the C&R operation

It’s not only about collections. Though of course that is important, customer engagement brings a range of benefits as we saw in our previous slide.

Such engagement springs from a deep understanding of the customer, based upon rich, subjective customer data and positive and compliant customer contact.

LESSONS

In the end the collections and recoveries operation should

represent resolutions in the credit provider-customer

relationship. Longer term benefits, facilitated by the MSP,

are of value to both parties.

Five ways a managed service collections and recoveries approach can positively engage your customers to successfully recover debt:

- 1 -Understanding the

customer through rich, accurate, timely data

- 2 -Adopting the right

approach by skilled, experienced DCA partners

- 3 -Facilitating data collection and analysis for the client

- 4 -Engaging with the

customer in a positive and compliant manner

- 5 -Lowering non-performing facilities

through positive debt recovery, customer rehabilitation and future

business opportunities

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THE DEBT

PORTFOLIO BLUEPRINTHow to build a managed service model to improve collections and recoveries.

A managed service model can help you to put customers first, obtain the best possible result, and improve your collections and recoveries.

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Managed service collections and recoveries can outstrip in-house resources. Discover how you can benefit.

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