The debt collection sector is experiencing a unique transformation influenced by several factors, with the most prominent being technology and labor shortages. In 2020, The Bureau of Labor Statistics Occupational Outlook Handbook estimates that U.S. jobs will increase on average by 9% year-over-year. However, debt collection jobs will see a significant decrease of 8% by 2028.
For many organizations, traditional debt collection can be daunting. Most debt collectors are still tied to reaching out to debtors via phone, mail and email. These traditional attempts at collection often amount to countless phone calls, ignored correspondence and customer dissatisfaction.
Evolution of Debt Collection
Over the last several years, there have been significant shifts in debt collection due to technological, economic and social changes. This is even more prevalent now with COVID-related labor shortages and increased lender competition resulting in increasing debt levels.
In this evolution of debt collection, technology is transforming and automating processes through advances in artificial intelligence (AI), deep data analytics and automation. Consequently, the shift to technology solutions is reducing the need for human interaction while solving for today’s labor shortages. There are several factors influencing the new technological trends in debt collection.
• More complex and ever-changing regulations
• Increased use of mobile phones around the world
• Consumer mentality and the evolution of debt
• The impact of digital platforms
As today’s technology advances, debt collection systems will continue to change with time, leaving non-adopters and stragglers at risk of depending upon outdated debt collection practices. Visionary organizations are already embracing technology to supplement their current processes – reducing customer friction, improving the customer journey and increasing profitability.
Advantages of Digital Debt Collection Technology
AI-Powered Virtual Debt Negotiator and Virtual Payment Agent
As debts grow, Artificial Intelligence is creating effective debt collection processes for organizations. This technology settles debt needs effectively, smoothly and painlessly by reducing consumer handling, simplifying debt collection processes, and increasing accessibility and flexibility. Most importantly, an AI- powered platform enables an organization to build and maintain positive connections and relationships with its consumers.
When contacted digitally, consumers are more likely to make a payment or pay in full, and this likelihood increases for consumers with accounts that are more than 30 days past due (30• DPD). 1
With AI-powered debt collection technology, consumer embarrassment is no longer a barrier to collecting payments. Instead, the technology enables organizations to use advanced analytics and machine learning. Through analytics, a company uses consumers’ unique preferences to create an effective debt collection strategy, leading to increased opportunities of settling debts.
Improve Your Debt Collection Customer Experience with JMB Global Services
The right virtual agent and debt negotiator platform can significantly increase collection outcomes. This powerful technology will continue to transform the financial sector by reducing guesswork and human bias during debt collection. Contact JMB Global Services today to learn more about our revolutionary AI-driven debt collection platform and schedule a demo.