How data and technology can help overcome challenges faced in the credit and collections industry

The cost of living crisis is still creating impact, with almost one in every two people (48%) reporting declining confidence in their ability to pay the bills and make ends meet, and more than 53% saying they have had to delay a bill payment in the past 12 months. Alongside this, recent regulatory changes and customer vulnerability continues to create the perform storm within the credit and collections industry.

This blog explores the challenges facing this industry and how data and investing in the right technology can play a role in alleviating these emerging challenges.

Challenges

Customer vulnerability and lack of engagement

Customer vulnerability is impacting the credit and collections landscape at speed, and maintaining a customer-centric approach is essential, but also challenging. It’s imperative for organisations to understand their customers individual situations, needs and requirements to deliver the best solutions and outcomes for all parties. A survey showed that 75% of people who struggle with anxiety stated they avoided face-to face, phone and postal communications altogether regarding managing their utility bills – so how do credit and collections organisations effectively engage, communicate with and deliver services to customers who are avoiding their communications?

Offering customers multiple, easy to use, personalised touchpoints and channels, depending on their journey and situation can help start engagement in a place they feel most comfortable. Seeking new ways to understand what works best for clients by utilising an omnichannel customer engagement approach can not only engage those who are at risk, but also identify those who are likely to ‘be at risk’ – increasing the likelihood of resolving issues faster and creating better payment plans and options in the future.

The importance of data

Organisations have more customer data than ever, but unlocking its full potential isn't always easy. Many still struggle due to old, legacy technology and disparate systems that aren’t able to provide a holistic view of their data. Recent research shows that 43% of businesses lack clarity on how to act on data insights, and 84% of employees believe their boards’ use of CX data needs improvement.

In addition, organisations aren’t collecting the right data – with 71% collecting only solicited data (ex: surveys), and on average listening to only 3-5 calls per agent to per month (less than 1% of all interactions). That means many are leaving valuable information untouched.

Pulling data from a multitude of sources, including analysing 100% of conversations both on and offline with technology such as conversation intelligence, will enable organisations to build a bigger and better picture of their customer base. It can help identify and uncover patterns and trends in customer behaviours – identifying those at risk, or likely to be in the future.

By drawing knowledge from all possible sources, organisations can not only unlock valuable customer insights, but can also provide much needed insights in real time to agents – helping to navigate complex calls and reduce repeat contact.

Employee experience = customer experience

Increasing debt, rising interest rates, cost of living challenges and the introduction of new regulations has led to a rise in complexities of calls in the contact centre. Organisations need to ensure they are providing agents with the necessary training, coaching and tools to not only navigate these difficult conversations, but also resolve them. Yet, 2023 research shows only 18% of organisations are carrying out tailored 1:1 coaching for call centre agents.

It’s imperative for agents to have the right coaching and feedback to offer empathy and understanding to reach the best outcome for the customers. But how can organisations deliver this? Technology, such as conversation intelligence, can help capture all omnichannel interactions – and through analytics, uncover insights that provide agent coaching recommendations, next-best guidance alerts, like compliance warnings or critical customer information such as missed payments or building debt.

The role of technology

Effective communication and risk management are imperative in the credit and collections industry, and investing in the right technology can be a game changer – if utilised correctly. Conversation intelligence can help leverage data insights to empower organisations to navigate complexities, mitigate risks, make informed data-driven decisions and deliver better outcomes to employees and customers.