CRS podcast ep 2: How does technology help to identify won't pays?
Welcome to the second edition of the CRS Podcast in ‘The Big Questions’ series, where we bring you a panel of experts diving deep to discuss the ‘biggest questions’ facing the Collections industry in the age of technology.
Recently we hosted ‘Collections in the Digital Age’ our inaugural event. A key feature of the day was the expert panel discussion on a range of questions surrounding technology and its impact on the Collections industry. We excited to be able to bring you the audio recordings from the day and present the transcript in this post and as a podcast on our CRS SoundCloud page.
But before we get into the transcripts let’s introduce our first-class line up of panellists:
- Gary Grey (GG) Head of Collections at Spark Energy
- Caroline Burston (CB) Operations Director at CRS
- Caroline has worked in the Debt Collection industry since 1993 and gained extensive experience at several collection agencies and solicitors’ practices. Caroline is a well-known industry figure and brings extensive compliance experience and knowledge to CRS and is also a member of the prestigious Credit 500.
- Tony Gunderson (TG) 30 years + experience in financial services
- Lisa Beeching (LB) Head of Supplier Management and Quality Assurance at 1st Central
- Lisa is currently Head of Supplier Management and Quality assurance at 1st Central Insurance and Technology managing key supplier relationships across 45 suppliers spanning all operational areas from sales through to claims.
- James Squires (JS) Business Development Director at CRS
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Now that you’ve met the panel let’s see how they wrestled with this ‘Big Question’. The questions kicks-off with our host on the day James Squires…
JS: “How does technology help to identify the won’t pays? Caroline, we’ll start with you on this particular one.”
CB: “So a lot of the MI, reporting and the information gathering that we do with technology to establish the won’t pays, is where we map the customer’s journey when they’re visiting the website.”
“A typical example that we’ll see is customers going to the income and expenditure page and completing it five or six times until they get down to that one pound that they can afford to pay.”
“So, there’s a lot of information around (data) which then allows us to challenge them and say that.”
“There’s also a lot that click onto the website or click on an SMS, that counts as a right party contact to us now, typically you’d only get that if you engaged with them over the telephone.”
GG: “I think just from our perspective in terms of identifying the won’t pays. The most obvious ones are those customers that are constantly late in terms of their payment history and always get to first or second placement, that’s one key area.”
“I think the other key bit of information that we use is what information we get from a credit reference agency to then feed into our collections pathway. We don’t have a one size fits all collections path that treats everybody the same, we risk profile them and then the treatment we undertake for those customers is different based on the information that we get back from the credit reference agency, that’s one touchpoint.”
“I think the second touchpoint then is when we put the account for legal activity, we use the debt collection agency to scorecard the debt. So they will then work out the customer’s ability to pay or the affordability of the debt. Then they will also make a choice around progressing the account because it’s a commercial agreement we’ve got with you guys in terms of; we don’t want to be paying out more than we’re actually collecting so we’re really tight on using a scorecard to make sure you progress the right customers.”
JS: “Very interesting. I actually want to take that point from Caroline actually and Lisa down at the end there…”
LB: “I’m happy. I’m alright ha ha”
JS: “Well actually I wanted to talk about the, I suppose for want of a better phrase, the funny business that was going on there on the website in terms of the manipulation of the I and Es, and really trying to understand your view of how you perhaps try to counteract that. First of all, identify it and then counteract it, Lisa?”
LB: “Yeah, so certainly in the insurance world we do it in two aspects.”
“The first bit for us is obviously getting the premium risk right. We have measures that will look at the data that customers are rendering in that journey. We will understand when they’ve changed it; customers are very quick to put a claim on and take a claim off, put a speeding conviction on and take it off again, and we’ve got fraud detections behind the scenes that will look at that activity and understand what journey you’ve gone on and what price you finally pay.”
“What we also do before you purchase that policy once the price has come up, we run checks in the background. So we will also say yep we can offer you a price but you then might go onto say ‘but I want to pay by instalments’. We will do further checks against your credit history background to ensure that actually as a payer you can afford to pay it and your collection history and where you sit from a credit scoring point of view matches the terms of those agreements. We brought that in a couple of years ago, that extra step, before it was a blanket ‘you can have instalments’ and now we vary that based on your credit rating, what sized deposit we would expect you to pay and what size interest we would put across that agreement.”
“We offer a personalised journey based on customer input and from that point of view we’ve been able to see our debt position decrease based on assessing those credit risks at the start.”
JS: “I’ve heard a lot today about personalised journeys and actually not a one size fits all approach, so this really fits. Tony are you able to or do you have any other view on this?”
TG: “Not really, I mean a lot of this you can see in the willingness for people to engage with you and how difficult that engagement is can quite often highlight one or two things: either the vulnerability which you need to explore or the people that are just simply trying to avoid contact. But it’s based on supporting what the others have said really.”
GG: “I think in my experience where you have things like fraudulent transactions that are carried out online, people who are trying to carry out those fraudulent transactions tend to use a channel which isn’t a customer-facing channel. So what I’ve done at previous companies is I remove the customer’s ability to make debit card payments via the portal and actually force them to have a face-to-face conversation with an agent so that you can go through verifications around debit card information etc. So that you know that you’re taking the right payment, from the right customer, using the right card.”
JS: Great point, great point.