A Digital Debt Collection Future
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Executive Summary
A Digital Debt Collection Future: Consumers at the Center, commissioned by Sopra
Banking Software and produced by the Aite-Novarica Group, describes the collections
challenges faced by financial institutions and the transformational investments they are
beginning to make. This paper was informed by interviews with 10 collection executives
at financial institutions headquartered in the United Kingdom, France, and Germany.
Key takeaways from the study include the following:
While collectors braced for a sharp increase in delinquent accounts, customers
ultimately performed better than expected. During this critical time, institutions
quickly rolled out new digital capabilities to aid their customers while pivoting to
remote work.
Collection businesses at many financial institutions are now looking at how they
can transform their processes and upgrade from outdated platforms. Study
participants noted that the expected rise in delinquencies that may begin later
this year will test their manual processes.
The technology investments under consideration seek to achieve three goals:
better customer engagement through modern communication channels, greater
automation and customer self-service opportunities, and the ability to create
personalized journeys through informed insights.
While these technology investments can help institutions collect more debt and
realize efficiency gains, another emerging driver for these changes is the need to
treat customers fairly. The focus on customer experience is driven by a desire not
only to retain these relationships but also to comply with various regulatory
requirements.
Overall, collection executives believe the future of collections must include a
more digital and targeted approach to automate certain processes and increase
engagement. While this transformation is imperative, it will not replace the
critical role of collection agents in providing a human touch when needed.
Instead, it will allow for better deployment of this resource to the most complex
or vulnerable cases.
