Yes, it’s a Monty Python reference, and if you have never seen the Pet shop skit please take a moment to watch it now, and give yourself a treat!
So the question remains: is the collections industry fatally wounded by all the restrictions and regulations that lay at its door, or is it ‘just resting’? Some organizations have suspended some collections actions and practices in response to recent regulations, for example:
- Debt sales have been suspended or severely restricted for fear of not being in compliance;
- Power dialer use is restricted due to concerns about ringing mobile phones;
- Litigation and foreclosure volumes are dramatically reduced;
- Robo-signing has opened the property system to legal liability;
- Skip trace activities are now more strictly regulated.
Is this the death knell for collections? I don’t believe so. As long as financial institutions, utilities, hospitals, telecommunications companies, and governments continue to lend money, provide services, and collect taxes, there will need to be a group of people skilled at talking to customers and asking for the money that’s due! I believe that there is a wave of events now taking place that the collections industry must react to in order to move forward.
A Deep Clean Is in Order
Rigorous documentation control and operational transparency must underpin all actions. There must be a clear line of sight and documented paper trail of a customer and their debts, from the point where they signed a contract to when they took on the debt or service. Next, the collector must position how they treat each customer as an individual, and understand their circumstances in order to offer appropriate solutions. The collections industry must adopt a holistic ‘customer service’ approach and deliver debt solutions to really assist customers.
I still believe we need experts in the field of collections. I know from personal experience that this not a role all contact center people will enjoy, let alone excel at, but collections specialists with the right tools can be part of the customer’s ‘recovery’ back into good financial standing. Collections can be the solution if done sensitively and with the customer’s long-term interests in mind.
"...collections specialists with the right tools can be part of the customer’s ‘recovery’ back into good financial standing."
My prognosis: Collections is not dead; it has not gone the way of Mr. Praline's Norwegian blue parrot in this classic Monty Python skit; rather, it is evolving. It just is having some growing pains and a low pulse while deciding how to best take the next evolutionary step. In the meantime, we’ll continue the CPR!