In Focus Consumer Credit
Left-right: Adam Dunn; Alan Smith; Amanda Brandon; Anne Atherton
What is more important: getting the asset back, the customer journey, or reputational risk? SB: It is one of those questions: you have priority one, two, and three, and they are all priority one! Ultimately, reputational risk is the thing that, if you manage that, then you would hope that, in a lot of cases, your customer journey would start to fall into place. If you are doing that right, then you have probably got a slightly better than average way of getting your vehicle back. So reputational risk would be my simple answer. The hard part is, of course, that most of the time none of us are doing it ourselves, so you are trying to get third- parties to live to your processes and to your company values. It is a different world from what it was when I joined the industry in the mid-1990s, so reputational risk is everything for us from a customer and regulatory point of view, but, ultimately, it is also the right thing to focus on.
SB: It is a strange situation. I assume that everyone will be in a similar position that, once you have your vehicle back, the chances of getting any further recoveries is significantly reduced. Maybe if you get three more payments you are in a better position leaving it with the customer, if the vehicle is not going to be massively devalued within that period. Regulatory requirements sometimes push you towards an agenda and you can end up doing the wrong thing for the customer just because you follow the procedure and that turns out to technically be the right thing to do, but it is probably not actually the best outcome for the customer. There are sometimes cases where the intent is with the customer, you just need to give them the time to have the ability.
22
It is a different world from what it was when I joined the industry in the mid-1990s, so reputational risk is everything for us from a customer and regulatory point of view, but, ultimately, it is also the right thing to focus on
AD: I quite agree that it is very fine line between reputational risk and customer journey, and if you look after the one, then the other will follow. Then the third thing is that, as a final step, then we will want our asset back if we get to that point. The hope is that if you have approached the first two correctly, then you should not have to get to the third one. This is, of course, a question that we face
on a daily basis: do we draw the line in the sand now or do we give them more time? And sometimes we get burnt by giving them more time, because we have essentially given them the chance to sell on their asset or to hide it, or else crash it and get a pay-out from the insurance, but we do not see a lot of repayment after we have taken the vehicle back, so we try to avoid getting to that point.
SW:We do not really have such issues because any repossessions would come from the lender. As a broker, we sit in the middle of the process, although we might have some discussions with the lender around what happens if someone defaults on their
www.CCRMagazine.com
payments so that we are aware of that for the future and if the same customer comes back, we are aware of what has happened. From our perspective it would be more of a concern to understand why the customer defaulted in the first place. We have TCF issues that we need to be concerned about around the customer’s finances and whether, for example, they would need the car for anything else.
JM: It is really important to have customer vulnerability as a high priority. Apart from being the right thing to do by customers, it is also high up on the regulatory agenda and will remain so for the foreseeable future. The FCA has vulnerability as an area of focus in its recently published priorities for 2019/20 and the Financial Ombudsman Service pays close attention to the issue in its complaints handling. It is really important to be aware of the repercussions of vulnerability, especially the consequences for the customer if you take back the car.
Currently, recovering a vehicle can be reactive: giving an agent an address and waiting for an outcome. Does anyone approach repossessions differently? AA:We try to engage with customers in all the different ways that we can. We use chat, SMS, telephony and e-mail in addition to traditional methods. We are a fin-tech company so we use as many different methods as we can to contact customers. And we do find that we are getting a better contact back, particularly from the younger customers, through SME and instant chat. This is fine in the early-collections
environment, but by the time that you get to a repossession stage, if you are not
June 2019
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52