The start of a new year is a great opportunity to reflect on past achievements and challenges and set new goals for the future. For any debt recovery department, this means finding ways to improve their performance, efficiency, and customer satisfaction.
In this white paper on Affiniti Perspectives, we aim to share 5 best practices and innovations that can help you achieve these objectives in 2024 and beyond.
Summary
- Harness the power of predictive AI & ML
- Enable sustainable hybrid debt recovery automation
- Prioritize to remote debt recovery monitoring
- Integrate on-platform legal case management
- Enhance staff training and development
Harness the power of predictive AI & ML
One of the key challenges in debt recovery is to identify the customers who are most likely to pay their debts and the best strategies to approach them. This requires a lot of data analysis and human judgment, which can be time-consuming and prone to errors.
Fortunately, artificial intelligence (AI) and machine learning (ML) can offer a solution to this problem.
AI and ML are technologies that can learn from data and make predictions based on patterns and trends. They can help debt recovery departments to segment their customers based on their creditworthiness and default risk, and to tailor their communication and collection methods accordingly.
There are different types of AI and ML models that can be used for debt recovery, but two of the most popular and effective ones are Random Forest Regression and XGBoost.
Random Forest Regression is a model that uses multiple decision trees to make predictions based on the input variables. XGBoost is a model that uses gradient boosting to optimize the predictions by reducing the errors. Both models have been shown to have high accuracy and performance compared to other models, such as linear regression or neural networks.
The benefits of using predictive AI and ML for debt recovery are manifold. They can help you to:
- Increase your recovery rate by focusing on the customers who are most likely to pay
- Reduce your operational costs by optimizing your resources and avoiding unnecessary actions
- Enhance your customer experience by offering personalized and empathetic solutions
- Improve your decision-making by providing data-driven insights and recommendations
AI/ML technology is the foundation of our award-winning debt recovery solution, Affiniti Collect Plus.
Enable Sustainable Hybrid Debt Recovery Automation
While full automation promises efficiency, it can lack the human touch crucial for fostering positive debtor relationships and negotiating successful resolutions.
The future lies in hybrid automation.
A hybrid debt recovery automation model allows you to integrate different types of automation tools, such as robotic process automation (RPA), chatbots, or voice assistants, with your existing human workforce. This way, you can leverage the strengths of both automation and human agents and assign the tasks to the most suitable entity.
For example, you can use automation tools to handle simple and routine tasks, such as sending reminders, verifying information, or updating records, and use human agents to handle complex and sensitive tasks, such as negotiating payment plans, resolving disputes, or providing emotional support.
With Affiniti Collect Plus, you have full control of highly effective hybrid automation.
Prioritize Remote Debt Recovery Monitoring
Remote debt recovery monitoring is the process of remote tracking, measuring, and evaluating the performance and activities of your debt recovery team and customers, using various tools and methods, such as dashboards, reports, analytics, or feedback.
The COVID-19 pandemic has changed the way we work and communicate, and has forced many businesses to adopt remote working models. This has also affected the debt recovery industry, as many debt collectors and customers have shifted to online or digital channels.
The sweet spot of remote debt recovery monitoring is when common issues such as visibility restrictions, lowered user-friendliness, lack of hierarchical collaboration, and lowered security are perfectly resolved.
Remote debt recovery monitoring can help you to:
- Improve your team’s productivity and accountability by setting clear goals, expectations, and incentives, and providing regular feedback and coaching
- Enhance your customer’s engagement and loyalty by understanding their behavior, preferences, and needs, and offering them relevant and timely solutions
- Ensure your compliance and security by following the best practices and standards, and using the appropriate tools and protocols
- Optimize your process and strategy by identifying the strengths, weaknesses, opportunities, and threats, and making data-driven decisions and improvements
The star module of our award-winning debt recovery solution, Affiniti Collect Plus, Affiniti MobileXtend is a great example of that sweet spot.
Integrate On-Platform Legal Case Management
Sometimes, despite your best efforts, some customers may still fail to pay their debts or cooperate with your debt recovery process. In such cases, you may need to escalate the matter to a legal action, such as filing a lawsuit, obtaining a judgment, or enforcing a lien.
However, conventional legal action can be costly, time-consuming, and complex, and can damage your reputation and relationship with your customers.
Therefore, the next New Year resolution that we recommend is to have a robust and efficient legal case management system that can help you handle the legal aspects of debt recovery.
A legal case management system is a system that allows you to manage and monitor the legal cases related to your debt recovery process, such as creating and storing documents, assigning and communicating with lawyers, tracking and updating the case status, and generating and analyzing the case outcomes.
A legal case management system can help you to:
- Reduce your legal costs and risks by streamlining and automating the legal workflow, and avoiding errors and delays
- Increase your legal success and recovery by selecting and collaborating with the best lawyers, and following the best practices and procedures
- Improve your customer’s satisfaction and trust by resolving legal issues fairly and transparently, and offering them alternative dispute-resolution options
Affiniti Collect Plus also has a dependable legal case management module.
Enhance Staff Training And Development
The last but not the least resolution for any debt recovery department is to enhance staff training and development.
Your staff are your most valuable asset, and they play a crucial role in the success of your debt recovery process. They are the ones who interact with your customers, understand their problems, and offer them solutions.
They are also the ones who use the tools and technologies that you invest in and adapt to the changes and challenges that you face.
Therefore, it is vital to invest in their training and development and to equip them with the skills and knowledge that they need. It ultimately helps your collections and recoveries department’s efficiency increase exponentially.
Conclusion
By embracing these five resolutions, your debt recovery department will be on the fast track to success in 2024.
Remember, it’s not just about recovering debts; it’s about building a future where technology and human ingenuity work together to create a more efficient, effective, and ultimately, more empathetic debt recovery experience for everyone involved.