Feb 22, 2013 Philip Burgess
New technology has provided debt collectors with opportunities to refine practices and carry out more efficient, timely activities, such as cloud computing and analytical tools. Debt collection agencies still need to ensure their practices are aligned with federal and state regulations, as well as industry-recognized best practices, to avoid sanctions, fines and other issues.
Markets Stream recently reported that consumer debt purchasing today has led many collection agencies to take advantage of advanced analytics tools and cloud computing services. These solutions have proven to be highly efficient and effective methods of driving more targeted strategies that lead to quicker collections and easier adherence to federal statutes.
According to the news provider, some agencies are using the tools specifically to improve communications with consumers, as this practice is one of the most highly regulated aspects of the industry in the Fair Debt Collection Practices Act (FDCPA). While cloud infrastructure cuts the costs associated with hosting and transferring data related to the collection process, statistical analytics tools provide an opportunity to refine consumer-facing strategies altogether.
The source explained that predictive modeling takes massive volumes of information regarding consumer behaviors in reaction to debt collection activity and categorizes the data into actionable strategies. With the information garnered, debt collection agencies can keep the numbers of communications to debtors down, thus adhering to the FDCPA.
In addition to the volumes of calls collection agencies are allowed to have with debtors, the FDCPA also prohibits a variety of other actions, including false claims, fraudulent identifications and abusive or harassing calls. While technology can help debt collectors streamline their communications strategies for stronger profit margins, these professionals still need to ensure that all policies, protocols and practices are aligned with federal and state regulations.