This page contains a Flash digital edition of a book.
In Focus Collections


all levels of arrears and not just at a point like 30 days or 60 days in arrears. Such defensive actions tend to be tactical


and linked to collections short-term KRAs rather than long-term business goals. In my opinion, if you have not already,


then it is time to do four things: l Check your collections system. l Ensure your communications strategy is clear and controlled. l Capacity plan and recruit staff ahead, rather than behind, the curve. l Be clear on the actions at the end of the process. Small operations can tend to ‘make do’


with collections systems. I even know of reasonable-sized companies still using Excel spreadsheets. So evaluate your system to ensure that: l You have capacity for double (even treble) the volumes. l You have actions allocated at specific points in the process – days past due, days since last payment, or days since contact. l Your communications (text and verbal) progress from a ‘customer service’ approach to more direct ‘collections’ approach, so as


to inform the borrower of the consequences when appropriate. l You have well-defined reporting so that you know how many attempts are made to contact a customer and that calls were made in accordance with the strategy. l You have the ability to identify customers based on profile or risk, so that they can be handled differently. l You have flexibility in the workflow to make modifications in case you find a better strategy, but avoid tactical adjustments to meet short-term objectives. l You have clear exit strategies, particularly for debt sale or management of cases by DCAs. The last thing you need is rump- debt sitting in a recoveries pot that that is either not being worked or is not producing a return.


Conclusion Whether we are about to go off the affordability cliff or not, it is clearly the case that an efficient retail lender must have an efficient collections operation, the foundation of which is an excellent collections system.


So check that your system gives you the control over your operation. And when delinquency rises, do not use tactics, rather stick to your collections strategy (having ensured it is fit for purpose) and staff up appropriately


So check that your system gives you the


control over your operation. And when delinquency rises, do not


use tactics, rather stick to your collections strategy (having ensured it is fit for purpose) and staff up appropriately. The good news is that the average


recession lasts for under a year and a half. So do not panic, just make sure you are prepared. CCR


February 2019


www.CCRMagazine.com


33


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