SaaS, software as a service, has by and large replaced on-premise software in just a few short decades.
- Globally, organisations spent $103BN USD on SaaS in 2020.
- The total SaaS market is expected to be worth $307.3BN by 2026.
- In 2010, 6% of total enterprise-software revenues came from SaaS offerings. This has now climbed to 75%.
SaaS offers enterprises more flexibility, functionality, and ease-of-use, while drastically reducing the time, money, and energy spent on maintaining internal IT systems. White-label SaaS solutions are particularly valuable. Companies can customise an out-of-the-box, ready-to-go solution with their own design, logo, branding, and more.
This post will outline what SaaS is, its benefits, and explain why SaaS is the future of collections.
A brief history of SaaS
While SaaS has technically existed since the early 1960s, its growth was largely fuelled by the widespread emergence of cloud computing in the early 2000s. Cloud computing presented a more user-friendly alternative than downloading software onto on-premise hardware. Software could be installed—and data stored—on off-premise servers (the “cloud”), thereby reducing the cost and effort involved in implementing the solution.
SaaS grew to lead the pack in terms of cost-efficiency, with one report finding that SaaS-based corporate performance management (CPM) tools were 77% cheaper than their on-premise competitors. Forrester also reported that back in 2011, the average time-to-deploy was 6 to 9 months for SaaS solutions, versus an average of 9 – 18 months for on-premise alternatives.
The different types of cloud-based SaaS products
There are a wide variety of SaaS products to suit a myriad of business needs. A single organisation might have a:
- Customer Relationship Management (CRM) Software (like Salesforce or Hubspot): CRM solutions provide an all-in-one communications hub, giving organisations a complete record of their interactions with each individual customer to date.
- Enterprise Resource Planning (ERP) Software (like Oracle or SAP): ERP software binds together an organisation’s various department-specific applications into a single source of truth (e.g. finance, marketing, and human resources).
- Project Management Software (like Asana or Jira): Project Management Software makes it easier for employees to collaborate, communicate, and delegate. They provide complete visibility into each project’s progress.
SaaS products have seen tremendous success in various businesses; however, many financial institutions still apply conventional approaches when it comes to collections management. Enterprise white-label collections management software (like receeve) makes it easier for financial institutions to recoup what they’re owed. They offer both a macro-level view into overall collections success, as well as providing case management capabilities—allowing users to dig into specific details regarding each individual past-due customer.
SaaS in collections: an untapped opportunity
Despite its benefits, only a small number of financial institutions have invested in SaaS-based collections management software. There are multiple reasons that might explain this. For instance, few seem to realise that they can “white label” this service. In other words, they can implement a ready-to-go, out-of-the-box solution and tailor its design to make it appear as if it was created by their organisation.
White-labelling makes for a more holistic, interconnected consumer experience. Consumers only deal with your organisation (or at least, with products that feature your organisation’s branding), instead of flitting between different companies’ tools on their path to repayment. Plus, this also increases the likelihood that consumers will pay. Some past-due customers may feel threatened by the prospect of entering payment details into a software that comes from a provider they have never even heard of/dealt with before.
By white-labelling your collections management software, you offer customers a seamless repayment experience. Customers perceive this as one cohesive product—and it is therefore entirely trustworthy.
Let’s explore the benefits of enterprise, white-label SaaS in more detail.
5 benefits of enterprise, white-label SaaS solutions
1. Quick updates/increased agility: Changes are regularly updated on the go, reducing the time, energy, and resources that organisations need to spend on digital transformation.
2. Require fewer IT resources: Software providers manage all the technical issues, easing the load on in-house IT resources.
3. Short implementation timeline: Benefit from rapid onboarding/time to value. With receeve’s enterprise collections software, implementation takes around 60 hours of consultation (e.g. less than 2 weeks).
4. Enhanced security and control: Before choosing your vendor, make sure to ask 7 key data security questions. This will help you to pick a provider that puts data privacy at the core of its offering, thereby enhancing your security.
5. Full control over brand image & customer experience: White-label solutions let you customise both the design and customer experience, allowing you to create any customer touchpoints you like.
Why financial institutions need to implement SaaS in collections
By implementing SaaS within their collections processes, financial institutions can combat an array of both internal and external challenges.
Innovative fintechs (who themselves usually operate with a SaaS-based model) are constantly evolving, rolling out new, customer-centric solutions. In fact, they sometimes even join forces with big banks to blend the best of both worlds: innovation and reputation. SaaS products allow financial institutions to keep up with this rapid evolution without having to handle lengthy, time-consuming, and expensive internal digital transformation projects on their own.
Keeping up with the competition
Adapting to changing customer behaviour (especially in the wake of COVID-19)
COVID-19 caused a 72% rise in the use of fintech apps throughout Europe, as well as a 20 – 50% global increase in digital-first banking channels. Financial institutions need solutions that can keep up. However, developing these in-house can be a costly distraction—especially if these projects fail. With SaaS, you can rapidly roll out customer-ready, automated, flexible solutions without needing to worry about development. This is even more important given the impending threat of non-performing loans (NPLs). It has been reported that “Debt purchasers with a high degree of automated collections are better placed to withstand the pressure”.
Changing compliance and accounting requirements
SaaS solutions automatically include any new compliance requirements in their updates. For example, IFRS 9 requires organisations to classify assets as “performing”, “underperforming”or “nonperforming”, meaning that the amount of reserve requirements will increase for every financial organisation.
SaaS-based collections management software, like receeve, provides instant visibility into the performance of each of your financial assets. This allows you to stay compliant at all times while requiring little to no manual effort. As Deloitte states: “Banking-focussed solutions delivered as higher level services such as SaaS or BPaaS [Business Process as a Service] can provide an out-of-the-box solution and help banks cope with the regulatory burden by ensuring regulatory compliance, auditability, transparency and security along the whole value chain, from the provision of infrastructure to the delivery of the service to the end-user”.
The cost of digital transformation
In 2020, worldwide spending on digital transformation was estimated to reach $1.3TN. It is estimated that by 2023, this figure will rise to $2.3 TN. With SaaS solutions, however, the cost of new updates is assumed by the provider themselves—not by your company. IBM cites ‘lower costs’ as the second most important benefit of SaaS solutions.
Lack of IT resources
50% of banks don’t upgrade IT systems as soon as they should. Plus, in-house data servers (requiring uninterrupted power and complex environmental controls) eat into your IT budget. With SaaS, however, all updates and costs are handled by the provider.
A recent report suggests that some organisations spend £2.01 million per year on merely laying the groundwork for digital transformation projects. In fact, the total cost of these projects eat up around 53% of the total IT budget. SaaS helps you avoid spiralling IT costs. Only pay for what you need and avoid hefty, lump-sum initial costs. If you ever need to add more users or access more storage, then you can do so without having to invest in brand new data centres or on-premise hardware.
According to the World Economic Forum, 98% of workers would like the option to work remotely. However, if your organisation uses on-premise software then remote employees won’t be able to access the tools (and data) that they need to do their job. With SaaS solutions, on the other hand, employees can work remotely, leverage the latest, most up-to-date industry solutions, and access crucial data at any time or place.
Embrace enterprise, white-label SaaS to power collections success
To succeed in the post-COVID economy, you need to implement enterprise, white-label SaaS collections management software. Improve your collections approach without having to spend time, money, or energy on internal digital transformation projects. Stay compliant at all times. Improve your employee satisfaction and stay up-to-date with changing consumer habits.
Ready to get started? Book a demo today to learn more about receeve’s white-label, SaaS-based enterprise collections management software solution.