New Technology is Changing the Game for Debt Collectors
“Debt collection can be difficult without the right technology. Make it easier with these new helpful digital resources.”
The world of debt collection has long been associated with images of relentless phone calls, stern letters, and frustrated debtors. However, the industry has significantly transformed in recent years thanks to technological advancements. These new forms of technology have become essential due to the increasing number of households with excessive debt. According to the Federal Reserve Bank of New York, household debt is at an all-time high of 16.90 trillion - an increase of over 2.75 trillion from 2019. Consider the increasing rate of delinquencies in the U.S. since 2021, and the need for debt collectors to remain in the loop with new helpful technology becomes necessary.
Although it can be difficult for organizations to start employing new debt-collection technology, these enhanced products can be implemented quickly, increase the efficiency of debt-collection procedures, and reduce stress for creditors and debtors. Continue reading below and explore these new products to remain in the loop and on top of outstanding debt.
Data Analytics and Predictive Modeling
Want a solution that cuts costs, improves customer service, and gives debt collectors a way to plan for the future like never before? Then, it might be worth investigating predictive analytics tools. In essence, these tools examine data to answer questions, identify trends, and extract insights— while providing debt collectors with the information necessary to strategize and make impactful business decisions. Imagine the ability to predict future events and trends!
A vast amount of data is floating around on consumers, and it can be challenging to determine the right approach to collect their outstanding debt. These tools can be used to assess a debtor’s ability to pay and prioritize collections efforts by helping debt collectors identify which accounts are most likely to result in successful collections and allocate their resources accordingly. Predictive modeling also allows for more personalized and strategic approaches to debt collection, making it a win-win situation for both parties involved.
Artificial Intelligence (AI) and Machine Learning
Whether you like it or not, AI is all around us and is constantly finding new uses in the business world to improve the workspace by automating day-to-day tasks, condensing large amounts of information into consumable portions, and increasing efficiency across organizations. In recent years, AI has transformed debt collection by providing companies with advanced analytics, behavioral science, and machine learning capabilities, enabling them to automate their debt collection strategies and improve their average day’s sales outstanding (DSO). As a result, companies can efficiently manage their debts, streamline their operations, and reduce their overall costs. A great example is the use of chatbots and virtual assistants powered by AI to communicate with debtors, answer their questions, and provide information about payment options, reducing the burden on human agents.
Automation and Workflow Management
Automation is streamlining the debt collection process. Debt collection agencies are using automation tools to send reminders, schedule follow-up communications, and even initiate payment transactions. This reduces the need for manual intervention and ensures that debtors receive consistent and timely communications. These tools provide the following benefits:
- Track debt collector’s performance
- Strong focus on priority accounts and delinquent cases
- Maintain updated borrower information
- Measure and analyze performance
- Improve collector’s productivity
This level of organization enhances efficiency and ensures that no accounts fall through the cracks.
Conclusion
In a time with inflation reaching the highest level in four decades and millions of Americans living paycheck to paycheck, consumers are expected to crank up their credit usage even further to make ends meet, making user-friendly debt collection technology more critical than ever. With help from data analytics, artificial intelligence, and automation, the debt collection industry is making strides to be more efficient and less intrusive.
But no matter what new technology is available, it’s important to remember that these tools are only as valuable as the data you funnel into them. That’s where MicroBilt steps in. For over 40 years, MicroBilt has been helping business owners and lenders manage their financial risks and providing turnkey debt collection solutions. With our suite of Collection and Recovery tools, you can keep getting top-of-the-line tools for skip tracing, location monitoring, and much more. Our products and services are designed to provide the necessary tools and data to keep you in the loop and get the money you are owed.
As technology continues to evolve, we can expect further innovations to reshape the debt collection landscape. Keep ahead of the competition and contact one of our helpful representatives today.
