The potential of collections management software is staggering. Yet, despite its ability to allow businesses to leverage AI to improve collections processes, there remains some scepticism surrounding the solution.
Inside, we take an in-depth look at the current state of collections, the opportunities presented to banks and how to
In today’s modern world, where consumers are more acclimated to outdated forms of communication and approaches, now is the time to start thinking and acting differently.
So, if you’re still sitting on the fence about implementing collections management software, uncover the truth behind these common questions.
Question 1: With collections management software, will I lose control over the overarching strategy?
One of the biggest questions we hear about debt collection management software for businesses is the concern that they’ll lose all control over their strategy.
However, debt collection management software aims to automate and streamline the collections process, while harvesting data which can be analysed and used to optimise the strategy.
The forward-thinking solution is designed to use cutting-edge technology to analyse trends and find correlations in behaviours. It’s then down to you, the company, to decide how you want to harness this information through automation.
The strategy belongs to you, debt collections management software just gives you the tools to take proactive steps that improve your processes.
Question 2: Will debt collections management software create a greater workload?
Implementation and the workload required to adapt regularly causes panic among businesses. The common misconception is that developing a new way of working will take a substantial amount of time to put into practice, as you have to train the wider business on how to use the technology. Plus, with such a vast array of tools on offer, some believe their employees will feel overwhelmed and the business will end up underusing such a powerful tool.
However, the reality is that integrating debt collections management software into your strategy is neither difficult nor time-consuming. In fact, solutions like ours enable internal collection agents to be more self-sufficient from the get-go, giving them increased independence from IT departments. Collection agents no longer have to lean on them to update messaging, change email templates and implement new strategies, which can take weeks to action. Collections management software allows agents to work autonomously and reduce the workload for the wider team.
Asking your team to pick up new digital tools shouldn’t be regarded as a hindrance too. Millennials (1981-1996) and Generation Z (1996-2010), who make up 59% of today’s global workforce, are computer-savvy by nature and welcome new ways of working.
Artificial intelligence and automation aren’t new, untested concepts. Most businesses already use CRM systems to automate processes, while over 50 million people are already aware of the power of AI through owning an Amazon Echo. Our collections management software can even be layered on top of existing CRM systems without risking any of the core processes or interrupting current workflows.
The dawn of digital collections management software using AI, machine learning (ML) and automation is a direct response to changing consumer behaviours which demand greater efficiency and ease. Remember, your employees fall under this bracket too. So, when you sell the concept of collections management software to them, they’ll appreciate its value to your business’ customers and buy into the technology quickly.
Question 3: Will a third-party solution impact customer loyalty and the customer experience?
The next frequent question we get around collection management software is regarding the assumed impact it has on customer loyalty and the customer experience.
This misconception has emerged largely through the aggressive service some collections agencies have offered over the past few years.
Many debt collections agencies are missing the point by attempting to bridge the gap between old and new ways of working. Customers want convenient solutions, on their terms – not several phone calls, letters and emails all at once, with unrealistic timelines and lengthy calls to action.
Using a digital collections agency may be perceived as a safe route of trying to chase outstanding balances, but it doesn’t provide you with a solution capable of maximising processes and enhancing the customer experience. Relying on the expertise of an agency is effectively relying on instinct over logic. Whereas, leveraging the power of AI will allow you to make smarter decisions on sending the right form of communication, via the right digital channel and at the right time.
Gaining access to consumer behaviours will give you an automated digital process that acts on preserving relationships, instead of focusing solely on settling accounts receivables. In turn, this will maintain the customer-client relationship and safeguard future success.
The key is to treat collections as a form of communication, rather than the imposition of terms. By using collections management software, employees can maintain control of the customer experience and manage the brand image/identity. Why risk it with an agency who would require time to learn the right way to represent your brand when a self-service AI-led solution gives you the platform to do it yourself and on your terms?
Question 4: Is collections management software solution too costly?
Many businesses associate artificial intelligence with a high-end expense. Will the upfront cost burn a hole in my quarterly budget? Will there be ongoing cost implications to upkeep the solution? And what if the collections management software isn’t the all-in-one answer to my problems?
The good news is that quality debt collections management software is becoming increasingly affordable and should be regarded as a reliable long-term investment.
Opting for third-party collections agencies or keeping operations in-house might seem like a cheaper solution from the outset, but it could cost you significantly more moving forward. As humans, we’re subject to cognitive biases, whereby we’re inclined to make irrational errors when it comes to making decisions.
The idea is that our brain absorbs an abundance of information during the day. However, our mind can only focus on one thing at a time, so our brain will look for shortcuts (heuristics) to help us make decisions. Unfortunately, these heuristics often don’t always generate correct judgments and the result is cognitive biases.
In other words, many collection agencies, by design, aren’t invested in your customers and are instinctively thinking about the fees they generate on every account they manage to settle. While making executive decisions based on a collection agent’s judgment, instead of data and science, can result in sending the wrong message to customers.
Making logical decisions based on scientific behaviours and AI, you’ll create automated processes that have the interests of your business and customers in mind. Therefore, delivering a strong return on investment.
Start your journey today
Hopefully, this blog helped shine some light on some of the most common questions about collections management software and enabled you to understand the key differences to digital collections agencies.
If you’re interested in learning more about how you can harness AI to automate collections processes, improve cash flow and create a positive customer journey, schedule a demo with us today.
editor’s note: updated on 26.5.20 for continuity and updated questions/answers. Enjoy!