What to look for in a debt collection solution
Dec 03, 2014 Philip Burgess
Does a debt collection firm need software equipped with hundreds of features? Probably not.
When scrutinizing what business professionals and consumers desire out of solutions, it's easy for the uninitiated to point toward "flash and trash" - or applications that can perform a wide variety of tasks that probably aren't necessary.
That isn't to say that select tools aren't useful. When a feature can turn a 15-minute process into a two-minute process, you know you've got yourself a winner. There are number of features a debt collection program should possess.
Usability and simplicity
There's a clear difference between "complex" and "complicated." It's OK for debt collection software to be intricate, but when it's difficult for employees to use, that's when an agency has a problem on its hands. WiseGEEK noted that assessing the capabilities of existing staff is a key part of selecting the right debt collection software.
This is where professionals must understand the difference between how a debt collection firm uses such applications compared to ordinary businesses. For instance, a person working at an agency is likely familiar with software capable of performing numerous feats. Most importantly, such a professional knows how to use those tools to the best of his or her ability. On the other hand, a debt collector working at a regional bank may just want the basics - monitoring, approval and payment. Provide him or her with analytics tools, and they'll likely be unacknowledged.
Monitoring, tracking and updates
A solid debt collection management system notifies concerned parties when an outstanding payment is not met by a certain date. Instead of requiring a collector to manually send an email to the person responsible for satisfying his or her debts, the software should automatically deliver the message the instant a payment is late.
From there, the solution creates a timeline that determines how it responds to user action. For instance, if a customer has failed to make a payment a month after it was due, then the record name and number would be highlighted in red. At this point, the software will recommend that the debt collector calls the person who owns the company money.
Each interaction with a customer must be recorded and categorized by a basic analytics function. Whenever a debt is paid, the record of the transaction must be labeled as satisfied and removed from the "priorities" list, which consists of debts that haven't been paid.
The days when a company would buy a solution from a developer and receive no long-term guidance are long gone. Now, it's an expectation that vendors give their customers ongoing support, and debt collectors should look for a software enterprise that regards application delivery as just one component of the comprehensive service. If a team isn't available during working hours to assist those using the debt collection system, then it's time to move on.
Loan Servicing Software provided guidelines for those purchasing debt collection software to follow:
- Identify functionality needs: While a bank that hands out 40,000 loans every year should use a program rife with automation, an organization that sanctions 10 loans valued at $360 million in total may require tools that support hands-on tasks.
- Favor scalability: If a purchasing officer is procuring a debt collections program to support long-term business growth, it's important that the application is capable of expanding in conjunction with those needs.
Also, enterprises must survey end-users to obtain an accurate view of what they want from a solution. If a system's tools are not cohesive with employees' work habits, the implementation may be set up to fail.