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It’s Time to Make Credit Collection More Human

Blog Post By Lester Estonina

Credit collection can be a thankless job. And it’s no wonder – it’s tough to ask someone to call people and remind them about the debt they owe. In my 15 years of experience in the industry, I’ve seen how stressful it can be for associates who are torn between wanting to collect payment versus being sympathetic to a customer’s situation.

This type of work does take its toll on agents. Research from the Consumer Finance Protection Bureau has found that large collection agencies experience up to 75 to 100 per cent annual turnover rates.

And customers will repeatedly go into delinquency if they do not deal with root causes of why they are unable to pay, continuing a vicious circle. We must recognise that change needs to happen on both sides of the interaction to increase employee and customer satisfaction.

With a customer-focused approach, you can turn a tough collections interaction into a positive customer experience.

Start with empathy

Yes, credit collection will always be a difficult conversation. But what I’m seeing as the key differentiator in successful firms is their ability to create authentic interactions with not only their customers, but also their associates.

Michelle Dunn, a veteran credit collector, illustrated this brilliantly in a Business Insider article: “Bill collectors aren’t the bad guys. They are a part of customer service with an unpleasant job. Bill collectors are also negotiators, mediators, counselors, accountant professionals and people, just like you and me.”

Unfortunately, many associates in the collection industry approach customers with threats or with little-to-no tact when discussing debt and payments owed. It can be a cold exchange, but it shouldn’t be.

Leaders need to coach their associates to collect, as well as understand and encourage their customers to improve the situation they are in. Keep your team aligned with the goal that you are not just here to collect the money, but to ensure that the customer is walking away respected. That is the key in making collections more positive. While this should be encouraged vocally amongst your workforce, it can also be monitored through transactional NPS surveys after calls.

And likewise, associates can use the interaction as an opportunity to educate their customers on their financial situation rather than stating the obvious circumstance. They should start by be empathetic to the customer’s current situation and customise the approach based on the customer’s risk to debt exposure. For example, if a customer has experienced a medical emergency and cannot make amends, you can customise a payment arrangement while not exposing them any further.

Providing customers with a “What’s in it for me?” or as we like to call them WIIFMs, is also incredibly important. Essentially, you want your customer to understand the benefits of timely payments to help encourage them. This should be closed with a gentle reminder to customers to keep their promise to pay, as opposed to threatening a customer of what can possibly happen if they don’t pay.

Your tools must stay human

At TTEC we’ve deployed roadmaps that help guide associates toward a successful collections approach by serving up talking points for various points of the journey.

These roadmaps deploy what we call the HEAR phrases- hear them out, empathise, acknowledge and act with statements that show you’re on their side. We listen to our customers and use the information they provide to intelligently help them manage their accounts.

The objective of your roadmap needs to be about making your customers feel that you are here to help their situation, not just asking for payment. It’s about taking action to come up with a win-win solution.

Hire right and reward the moments that matter

But it’s not just the tools that are needed. Your employees’ ability to have an authentic conversation around one of life’s most stressful situations is what truly makes the difference.

If you are hiring associates who are not fully prepared for this type of work or have a pessimistic outlook, they will not only perform poorly, but also spread these harmful interactions to both their coworkers and recipients.

It’s extra work, but consider the interactions you’ve had with brands that go the beyond to hire employees that match their mindset, like Apple.

This means being realistic and transparent to new hires about what this job entails and the difficulties they may encounter. Likewise, don’t forget to mention the positive impact they can make on someone’s life if they can help them through a difficult situation compassionately.

Once associates are on the job, always make time to honor those who go beyond what is expected in their role. This means acknowledging and rewarding those who make genuine connections with their customers with either tangible prizes or fun events such as group activities. I’ve always been proud of how TTEC has ensured that employee development in our field is recognised and encouraged.

Case study

One of our proudest moments was when a leading telco provider outsourced us to help turn around its employee experience. When our partnership began its collections unit was experiencing high turnover rate year over year.

We started by understanding the root causes of such turnover. Then, we built an end-to-end employee stream that touched every aspect of an employee lifecycle including:

  • Right profiling of candidates
  • Ensure leadership accountability
  • Employee rewards and recognition

By investing in our employees, TTEC stabilized its workforce and improved performance effectiveness. In the end, the client’s attrition rate was reduced from 95 to 18 per cent and employee tenure is now an incredible five to seven years.

Create meaning for everyone

In the credit collection industry, our goal is to make conversations more human for both customers and employees while achieving service goals. As I like to say as a collector, we need to be powered by emotions and fueled by passion. In other words, “collect to connect.”