Did you know that the outstanding public debt in the US is estimated to be over $21trillion as of January 2019? An average US household has $15,000 in credit card debt approximately, whilst 20% of US households have unpaid medical bills. These numbers bear the fact that collection opportunities are growing across industry sectors. Whether it is real estate, finance, healthcare or small business, debt recovery is key to optimizing cash-flow and keeping businesses afloat.
Whilst organizations are partnering with debt collection agencies (DCA), rapid technological advancements, mobile interactions and emerging new breed of debtors are making the process increasingly more complex and time-consuming. The challenge is further compounded by evolving regulations that vary from state to state. The only way to ensure success and high rate of recovery is to overcome new-age challenges while navigating the stringent regulatory environment. Here’s a breakdown of top three challenges and how can we at Oxygen Recovery Group tackle them to maximize recovery.
Managing Compliance Dynamics
The Fair Debt Collection Practices Act (FDCPA) was established to protect consumers from unfair and aggressive debt collection practices. But this is not the only regulation that debt collectors need to comply with. What makes it challenging is that in addition to FDCPA, many states have their own laws regulating collection practices. To fully insulate from potential liability, debt collectors need to comply with FDCPA as well as relevant state regulations protecting consumer interests.
Since state laws vary across states, the DCA must have rich and in-depth knowledge about various laws governing collection practices, your industry and region. It is imperative that apart from access to various industry associations, the agency should have the right tools and technology in place to ensure efficient compliance management.
Tracing Elusive Debtors
To recover the balance due to you, it’s generally only possible when you can connect with the debtors. Locating elusive debtors is highly cumbersome which makes the process inefficient and time-consuming. Though there is a deluge of information available today, sorting, sourcing and updating accurate information can pose a significant challenge in the absence of relevant tools and skills.
With powerful skip tracing, data collection and verification tools, Oxygen Recovery Group – as your preferred Debt collector can help update consumer and commercial information on a timely basis. Accurate information allows a collection agency to track down, make contact and ensure timely collection of unpaid debt, thereby reducing the risk of bad debts.
Creating Tailored Strategies
A Lack of a debtor-centric approach is one of the key roadblocks restricting a collector’s ability to optimize collection efforts. As in the case of sales and marketing, collection can also greatly benefit from accurate customer segmentation based on their ability to pay.
In a business landscape where data rules, the importance of powerful analytical tools cannot be overemphasized. Actionable insights can help segregate debtors based on variety of factors including delinquency bucket, outstanding amount, credit limit and capacity to pay. Such segmentation can then be used to create focused collection strategies, maximizing efficiency and recovery.
Optimizing Recovery while Maintaining Goodwill with Customers
A comprehensive and effective collection management can help keep your company solvent and in good standing. Look for a collection agency that thoroughly understands the FDCPA, FCRA, privacy laws such as HIPPA and that has the technological capabilities to ensure comprehensive debt management, ensuring compliant, focused and hassle-free recovery.