Collection agencies rely to some extent on technology to recover bad debt for you. In order to achieve the best results for you, they use technology for processing payments, communicating with your customers and also to research delinquent customers to find new contact information or determine ability to pay.

Payment technologies should align with your customer and how they like to pay.

People do not like speaking with collection agencies (shocking, I know) so by making it easy for them to pay without speaking with anyone,  collection payments become like other bills people pay.  In the past 15 years, we have seen a complete reversal in how people pay us with a majority paying online through our payment portal versus mailing checks.

Communication with delinquent customers is easier with enhanced technology.

Depending on the type of collection, collection agencies can use email or text to communicate with debtors. It works well for all commercial (business-to-business) collections, and in some cases for consumer (business-to-consumer) files. For consumer files, however,  consent is mandatory before contacting consumers by email or text. Collection agencies must also follow the law as respects required disclosures. For medical collections, collection agencies must comply with HIPAA by using only secure methods of communication.

Technology is used by collection agencies to locate people.

Collection agencies call the process of researching debtors “skip tracing“. Collectors use both proprietary sites from companies like TransUnion to find new addresses, phone numbers and to assess the ability of a debtor to pay. A good researcher also uses public information from social media sites to come up with a full profile. Since nearly 75% of consumer files referred for collection need some sort of research, this part of the collection process is essential.

In all of these cases, technology assists collection agencies do their job. However, using only technology without human input often comes up short. For example, collection agencies often batch process files, which means they send huge spreadsheets of data for machine processing. If the process ends there, the job is only half done. It takes a human being to review public data and social media sites to come up with a full profile.

The magic comes when collection agencies use the right balance of technology and personal contact. Technology is great for processing payments, but it takes a person to contact people and set up payment plans.