What Should Industry Leaders Pay Attention to Over the Next Few Years?
Updated: Oct 22, 2021
As we in the collections industry look ahead to closing out 2021 as well as to 2022 and beyond, things may feel a little unpredictable. What can we expect next? What do we need to be proactively ready for? While it is true that the future remains murky, there are a few general expectations that have emerged as industry hot topics.
Expect the Unexpected
The Hunstein ruling has called into question a widely utilized resource in the debt collection industry: letter vendors. Rulings like this blind-side the industry and set many of us scrambling to figure out how to comply without compromising profitability. How agencies weather these storms will vary widely and success will hinge largely on your agency’s ability to be flexible in how operations are conducted. Consider having contingency plans for critical operational procedures, even for the ones we take for granted. If something occurs where we can no longer do (X), then how will we accomplish (Y)?
The CFPB has provided some guidance for electronic communications (text and email) for notifying consumers of debts. While the guidance has some in the industry desiring greater clarity, many agencies will embrace these methods of communication, thus setting expectations for consumers that your agency also provides those same channels. While using channels beyond notices and phone calls is not mandatory, expect to be in a position to consider (or reconsider) its advantages and challenges if you haven’t already adopted them into your business model.
Continued Economic Uncertainty
As payment deferrals related to COVID begin to expire, many households will begin to see strain on their budgets as deferment expirations result in larger monthly payments and less financial freedom. Inevitably this will result in a greater volume of debts turned over for collections. Prepare for increased business by ensuring your agency has the staff, resources, and flexibility to take advantage of this opportunity. Prepare for increased consumer interaction by ensuring your collectors are equipped with training and retain new and existing debt collection law as well as modern, consumer-centric communication techniques.
A Greater Need for Conscious Communication
The importance and advantages of building a team of collectors proficient with empathy and the ability to create a perception of partnership with consumers in resolving debts cannot be understated. At the end of the day, we may not be able to predict or control external forces that impact our industry. What we can do is positively influence the perceptions, and indeed the lives, of those we are attempting to resolve debts with simply by embracing a communication standard that helps to build a more positive debtor/collector relationship.
This guest post was written by Dan Byrd. Dan is the operations specialist at Midstate Collection Solutions.