Early Stage / 1st Party Collections Strategies: A Response to Shifting Financial Landscapes in 2024

Feb 27, 2024 Samantha Grace Maschmeyer, VP of Sales
First Party Collections Call Center

Recent data from the Federal Reserve Bank of New York has unveiled a startling reality – household credit card debt has skyrocketed to an unprecedented $1.08 trillion, marking the most significant year-over-year increase since 1999. Credit card delinquencies, as reported by CNN Business, are currently at their highest levels since 2011, indicating a growing reliance on credit cards to manage budgets. While mortgage delinquencies were at an all-time low this past August, a recent uptick of 25 basis points from the second quarter suggests a changing landscape that requires attention.

Further, several state governments enacted laws related to collections that took effect January 1st, and the Consumer Financial Protection Bureau is expected to release new rules governing digital communications this year, which are likely to impact the use of technology when communicating with your customers.  These circumstances place pressure on collections teams to ensure their omni-channel communication plan is fully buttoned up and places a premium on each customer interaction.

In response to these challenges, many Fortune 500 companies have turned to ACT, a trusted partner in the Business Process Outsourcing (BPO) industry. We specialize in offering tailored Early-Stage/1st party collections and retention solutions designed to address the complexities faced by the collections department.

ACT’s Multi-Channel Service 1st Party Collections:

ACT’s 1st-party collections solution extends beyond a traditional call center approach, providing comprehensive customer communication options and end-to-end engagement. Our proficiency enables us to introduce a strategic framework to the receivables process. This includes the application of analytics to drive great performance. Our expertise enables ACT to address deficiencies and educate your customers efficiently, leading to cost-effective resolutions that will undoubtedly enhance your bottom line. 

We understand that customers may face delinquency due to a multitude of factors, each unique to their circumstances. ACT is committed to addressing delinquency by providing empathy, education and guidance to customers and helping them establish improved financial plans.

We also understand the need for empathy in collections is paramount. As such, we’ve developed customer-centric training program focused on skills to increase conversion rates. This training focuses on historical conversion trends and timing factors for successful resolutions, including specific approaches and repayment plans depending on the time of year. Our agents are trained in soft skills to identify and empathize with customers, particularly listening skills to assist with payment arrangement options when working with the debtor.

ACT distinguishes itself across four key dimensions: our delayered business model, our data-rich foundation, our employee ownership model, and our Total Experience Formula™. By removing profit and loss responsibilities from Operations together with our delayered model ensures efficiency, transparency, and direct access to program leadership. As the largest 100% employee-owned company (ESOP) in the BPO industry, our team’s alignment with client goals has not only driven a remarkable 31% drop in employee attrition but also fostered a personal commitment to delivering client value. The transformative Total Experience Formula™ encompasses all facets of customer interaction, including Employee, User, Digital, Multi-channel, and Customer Experiences, presenting a holistic and game-changing approach to customer experience management.

How ACT Can Support Your Collections Efforts:

  1. Reminder Calls/Messages: Our multi-channel capability to remind customers of their payment obligations via outreach messages and reminder calls ensures proactive communication.
  2. Early-Stage/1st Party Collections: Our comprehensive collections efforts include educating customers on spending limits, updating their accounts, seeking payment in full, establishing payment arrangements, and negotiating settlements. Our rehabilitative approach is designed to recover debts and avoid write-offs.
  3. Compliance Management: ACT has a rigorous compliance culture, led by a team of internal experts who work diligently to ensure that our 1st party collections/retention activities align with relevant regulations and industry standards, reducing the risk of legal issues.
  4. Omni-Channel Engagement: Utilizing all available digital and live communication channels, we tailor our approach to customers’ preferences, increasing successful contact rates. 
  5. Reporting and Analytics: Detailed reports and analytics on Early-Stage/1st party collections and retention performance offer insights into trends and strategy effectiveness. 
  6. Training and Development: Our agents undergo extensive training to handle sensitive collections conversations professionally and ethically.

ACT stands out as a different kind of BPO, with a delayered business model, proprietary Total Experience Formula™, and employee ownership (ESOP). Our impressive operational scorecards, with over 98% of metrics marked in the “green” category nearly all of 2023, attest to our commitment to excellence.

Contact us to learn more: https://www.acttoday.com/contact/

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