Pre-collections and collections

How much can your customers afford to repay? This isn’t simply about whether they can make the repayments now, but also about whether they can afford to do so over the long term as their circumstances change. An automated service like Experian’s Affordability Check provides you with a detailed picture of each individual’s circumstances, ensuring the amount you lend can be paid back at minimum risk to both you and your customer.

Before the pandemic, 4.1 million people in the UK were classified as being in persistent debt, with 15 million living on the ‘breadline’. Resolving such debt issues can be stressful and time-consuming without the right support in place. By encouraging your customers to share their banking data with a tool like Affordability Passport, you can speed up the onboarding process while getting accurate information that helps restructure payments. This is useful for setting sustainable repayment rates and rapidly reducing debts so that customers don’t move to collections.

COVID-19 has made it harder than ever to predict customers’ changing financial circumstances, which is why a tool like Experian’s Bureau Insights can make a real difference. It provides fortnightly customer management triggers and insights based on Open Banking data that can warn of potential repayment issues before they become problematic.

Manually sifting through individual customer data is time-consuming and costly. A solution like Affordability Check automates many of the processes to increase your ability to handle high volumes of customer applications. Designed especially for credit providers, it gives you the insight you need to manage risk at both individual and portfolio levels, which helps to avoid customers falling into debt.

Before resorting to a costly collections process, it pays to understand why a customer has fallen into arrears. It could be that they’ve simply forgotten to make their last payment or perhaps they have more serious financial woes. Save yourself and your customer time and stress by checking their financial circumstances with a solution like Experian’s PowerCurve Collections. This approach enables you to make an informed decision about the situation and decide what action to take.

One way to strengthen both your customer relationships and improve your brand reputation is to demonstrate that you’re treating each customer as an individual. Platforms like PowerCurve Collections do the hard work of managing and analysing your customer data to present you with suggested procedures that are tailored – and fair – to each customer.

Avoid triggering unnecessary collections processes and the costs that go with them by offering your customers options to stay on top of their repayments. A self-service portal like the one offered by PowerCurve Collections provides your customers with a convenient and discreet way to make repayments.

Following regulations is a crucial part of providing a fair collections process, but for that, you need accurate, up-to-date information about your customers’ financial health and the operational capabilities to ensure appropriate action is taken. Each step must also be clearly communicated to your customers in a compliant way. Thankfully, Experian’s PowerCurve covers all these bases, letting you do your job with complete peace of mind.

Debt repayment issues can’t be resolved unless you’re able to contact your customers. Smart tracing systems like Experian’s SuperTrace cross-check your details with a diverse set of customer and organisational data to alert you to any changes.

In 2019-20, around 1.8 million households moved home in the UK – around 8% of the total population. Unsurprisingly, the stress of moving can lead to people forgetting to provide credit providers with their new contact details, which is where contract-tracing systems like SuperTrace plays a crucial role in enabling you to reconnect with these ‘lost’ customers.

One key part of remaining compliant is ensuring you’re in contact with the right person. If you go to the wrong house – because your customer has moved – you could end up being reported to the Financial Ombudsman. Experian’s cross-checking solutions verify your customers’ contact details are correct and up to date so you can be confident you’re dealing with the right person.

The FCA’s regulations require you to know – and provide if necessary – which sources you’ve used to trace a customer’s address. Make sure you’re covered by using a solution like SuperTrace, which provides the proof you need in the form of a summary that includes residency score, common occupancy data (i.e., the people someone lives with) and Land Registry property ownership details.

Getting an accurate and up-to-date snapshot of your customers’ finances is more important than ever. The unique circumstances surrounding the COVID-19 pandemic delivered an economic shock to around 40% of the UK population in 2020. Look for tools that utilise Open Banking to provide you with access to the information you need about how your customers are being affected.

When a customer falls behind with their payments, how can you set a fair, but effective strategy for recovering the debt? A tool like Experian’s Data Enhancement Service reveals the value of your customers’ assets and converts them into a figure that you can use to determine the best way for them to pay back their outstanding debt.

Armed with an up-to-date and accurate picture of your customer’s financial circumstances, you can move on to negotiate a repayment plan that’s both fair and sustainable. DebtSense is one tool that can help, ensuring any outstanding monies can be repaid at an affordable rate that won’t add to customers’ financial stress.