We’re all now feeling the effects of ‘Covid debt’: physical, mental – and, increasingly, financial. Above all else, collections agents need to show customers that they care, and there are some key practical steps that teams can take to support this strategy of empathy
In January 2022, research from debt charity StepChange revealed that the number of people finding it hard to keep up with bills and credit commitments has doubled since the start of the pandemic, and that one in three UK households is now struggling. The report reveals that 6.4 million adults are feeling the pressure of debt and that this has negatively impacted health, relationships and the ability to work.
In addition, 15 million people in the UK are worried about paying the rising energy costs. The price of essentials such as food and clothing are rocketing up, as is fuel, leading many to “dive dangerously into debt” just to keep afloat.
Back in March, the UK’s major telecoms companies agreed a set of commitments to support and protect vulnerable people, placing collections right at the centre of their response to ensure customers stay connected and are given some relief from their payment terms. These included removing data allowance caps on all current fixed broadband services and allowing payment holidays.
Despite telecoms adopting support measures, many people are still unsure about their ability to cope financially, and this has turned the spotlight onto how organisations are treating their customers, the most vulnerable in particular. The telecoms industry long experienced a decline in customer satisfaction, rating lower than the UK average for most metrics, including trust, openness and transparency. Ofcom’s most recent annual report on customer service
revealed that the number of complaints telecoms operators are receiving is still higher than the regulator would like to see. Capita commissioned its own independent market research
to gain a deeper understanding of the issues facing people who currently have, or expect to have, unmanageable debt and how they want to be treated by their creditors during the collections process. The results clearly demonstrate that – like other industries – telecoms needs to rethink its debt collection strategies to make the process fair and supportive.
Collections teams are likely to be having more difficult conversations with their customers, and to achieve the best outcome for them they will need to use empathy – this should be their guiding principle, running through any actions that they take.
But how can companies continuously identify who’s really in financial distress and needs immediate support – and what is the best way to give that support?
We’ve identified six key areas that collections teams should focus on, if they are to genuinely help their customers and, ultimately, keep them. They must:
• make sure customers know their options
• identify the vulnerable early
• reach out in the right way
• treat people as individuals
• better assess affordability
• take advantage of AI technology.
Educate customers who are in arrears
People in this situation are likely to be unaware of the options available to them, so it is essential that contact centre staff take the time to explain the choices available and work with the customer to find a repayment plan that is affordable and realistic.
Identify vulnerable customers early
Many customers feel embarrassed about their debts and abandoned by the companies to whom they owe money; they may even feel scared to talk to them, allowing their financial situation to get even worse. Many of the participants of our research admitted that they wait for the company to contact them first.
Telecommunication operators can take steps to reassure their customers that they do want to help them. By extending the collections journey to include pre-emptive involvement and increasing end-to-end monitoring and automation, companies can engage with customers as soon as they’re deemed to be at risk of getting into debt. Some are already setting a good example: TalkTalk, for instance, has said that it now has processes in place for unemployed customers and those whose working hours have been reduced.
Be flexible about methods of contact
Some of the heads of collections we spoke to during our research said that they are removing the traditional fixed payment date model, where customers pay on the same day every month, in order to accommodate those whose income fluctuates.
A flexible approach should apply to contacting customers, too. As many as 67% of our research participants said they preferred to talk to a customer service agent rather than self-serve on a website. The customer should decide by what medium they are contacted, be that the telephone, online or even through a social network.
Use data to personalise the user experience
Telecoms operators can leverage data to their advantage to make more informed decisions – not only about which communication channel to use but also to address considerations such as when they should contact them and how often. Data analytics can also help uncover which customers are most likely to pay on their own and those who may need a little more help, allowing companies to adjust their strategy accordingly.
If operators are informed about the life moments of their customer, for example if they have recently experienced redundancy or a bereavement in the family, they can adjust their tone of voice and recommend different actions.
Improve affordability assessments
Open banking assessments can help improve the way income and expenditure is assessed by more accurately measuring affordability and identifying customer vulnerability. From this, a more appropriate debt repayment plan can be put in place.
Since the process is automated, the company saves considerable time and operational costs. The assessment categorises a customer’s current account data in Standard Financial Statement (SFS) format and offers a quicker path to debt resolution. It is then easy for the customer to share their transaction data via a simple user journey, where key income and expenditure insights can be viewed and edited in a collections dashboard.
AI can help agents and personalise the payment process
Assisted customer conversation technology
uses AI to analyse conversations and help contact centre agents to identify the best solutions to the customer’s query. The AI analyses the caller’s voice and recommends actions to the agent, so that they can then give the customer personalised and genuinely helpful guidance. Having identified vulnerability and provided the best solution, the agent is free to really listen to the caller and so better help them.
This technology is invaluable for agents who are working remotely. Not only does it provide direct in-call support, it also enables team leaders to follow calls so they can support and guide their agents via chat, and even identify when to intervene if necessary. And built-in intelligent analytics provide valuable insights to continually improve the service and meet objectives, be they to reduce churn, ensure regulatory compliance or just better identify vulnerability.
Another useful product, which offers a more empathetic approach to payments, is Pay 360 by Capita’s IncomeAI
, a digital invoicing and debt recovery solution that can send personalised payment notifications via email and SMS. An agent can then tell if messages were received, opened and which of them prompted payment.
This can encourage payments to be made on time at a lower cost than through traditional channels, and it also minimises administrative errors. In turn, the technology speeds up recovery rates when it switches to debt collection mode, which happens when payment notifications haven’t led to a payment being made.
It’s certainly clear that telecoms operators must do more to help vulnerable customers. By demonstrating the leadership of kindness when our people need it the most, organisations will reap the dividends of customer satisfaction and loyalty that will not waver even after we’ve emerged from the shadow of this pandemic.
Capita will be hosting a webinar on ‘How to support vulnerable customers whilst balancing commercial demands and building customer loyalty’ on 10th May, 2.00 – 3.00 pm (BST).