More and more often when I talk to our clients, the need to comply with the latest regulatory changes is a strong focus for their businesses. Getting the balance right between treating customers individually and fairly whilst recovering valid debts is a fine line to get right and they are increasingly turning to technology to deliver compliant processes. Their main reasons for this being:
1. Knowing the exact status of every debtor’s accountRecycling debts through multiple placements is common place in our industry, however it is fraught with opportunity to create complaints. Technology can provide solutions to avoid these through systematic controls such as full portfolio reconciliation and linking related processes, for example, to prevent queried or disputed debts from being recycled.
Being able to show that customer queries and complaints are handled effectively is a key component of the Treating Customers Fairly (TCF) outcome principles. When utilising external agencies or selling debt to debt purchasers this becomes increasingly complex. And when done at scale only a systematic solution, such as a real-time query workflow management tool, is able to support the necessary process to effectively manage the interactions between customer, agency and creditor, and, importantly, provide the management reporting to evidence that turnaround times are acceptable.
The recent Lending Code edition means creditors and debt purchasers are expected to share more detailed customer data with each other and external agencies. This includes quantitative data such as account statuses, and qualitative data, such as income and expenditure records, payment arrangement information or a customer’s agreed contact method. This complex challenge is being solved in different ways through technology, typically via richer XML data exchange or through data portals which provide better visualisation and hence better interpretation of the customer’s data and circumstances by collectors.
Customers have increasing awareness of creditors’ obligations, the regulatory environment and their ability to influence brand reputation. This inevitably leads to creditors needing to tailor their approach around the individual. I envisage this focus on being customer centric will drive our industry over the coming years. The emergence of new data services such as TDX Group’s data exchange HeliX, alongside platforms which use this data to enable granular segmentation and tailored treatment paths to show a full picture of the debtor, will become the de facto standard.
By Matt Trueman, Head of Platforms and Technology, TDX Group.