Thinking of Outsourcing Your First Party Collections? 4 Things to Consider - Alorica - ContactCenterWorld.com Blog
Thinking of Outsourcing Your First Party Collections? 4 Things to Consider
First party collections, also called financial care, represents as much as 30% of the total revenue in the accounts receivable management industry. Many companies outsource their collections work to save money, increase revenue and improve their focus on core competencies.
But, finding the right outsourcing partner can be the difference between a successful financial care program that helps meet your business objectives while providing a positive customer experience, and a program that can potentially damage your brand reputation.
Before your company decides to outsource first party collections, here are four things to think about:
1.Where will this work be performed?
Different industries, types of debt and customer bases may be better served by placing the financial care work in a single location. Others may be better suited to leveraging several different global regions. As part of the discovery process, determine whether your potential partner can meet your needs by asking:
- Do your accounts need to be serviced domestically, or can they be placed offshore?
- Do your partner’s offshore locations have a history of ongoing success?
- Could a champion/challenger program benefit your organization?
- How will your partner ensure your customers’ experience will be seamless, regardless of where the financial care work is performed?
A positive customer experience throughout the collection process is important for both your brand reputation and for collection success. Think carefully about the type of interactions your potential partner will have with your customers and what channels they will use to communicate—one country may be optimal for voice support, while other locations may be strong choices for non-voice work.
2. Will you be supported by a strong and secure technology infrastructure?
Financial care outsourcing, by its nature, deals with large quantities of sensitive personal and financial data. Any outsourcing partner you consider should have a technology infrastructure focused on storing and processing the requisite transactions quickly and efficiently, regardless of location, as well as the capability to vigorously safeguard your customers’ payment and non-payment data.
Ensuring that your outsourcing partner is PCI compliant is also critical—specifically, that they are certified as PCI compliant by a third party Qualified Security Assessor (QSA). Card companies, such as MasterCard, require service providers be QSA compliant; a non QSA-certified vendor may be limited in how they can collect on your debt and how well they can protect your data.
Other technology and security considerations include the outsourcing partners use of proven proprietary technologies, their ability to use technology to turn data into actionable insights, and their ability to use client host systems, managed systems or a blend of client and managed systems. These types of technology advances will help drive operational efficiency and drive process improvements for a better overall customer experience.
3. Does your prospective partner have robust compliance capabilities?
Accounts receivable management is a highly regulated industry. Third party collections are subject to the Fair Debt Collection Practices Act (FDCPA), administered by the Consumer Financial Protection Bureau (CFPB). While not currently the case, it is possible, based on recent CFPB enforcement actions, that original creditors and first party outsourcers may also be brought under the umbrella of the CFPB and FDCPA sometime in the future.
Any partner you consider should be knowledgeable of and prepared for these potential changes. Ideally, their financial care program would already comply with many or all of the anticipated future regulations.
4. Is there a demonstrated history of expertise and success?
First party collections are a unique outsourcing function. Since the collections are done in the name of your business, it’s vital your customers enjoy the same exceptional experience they would expect from you. This means that throughout the entire collection process, customers should never realize they are talking to a different company.
Ask potential partners what their expertise is in customer experience transformation and what procedures they have in place to identify and implement process improvements that benefit both the customer and your business objectives.
Entrusting an outsourcing partner to interact with your customers should not be taken lightly. You’re putting your business and your brand in the hands of another company. Consequently, you need to feel confident your outsourcing partner is positioned to provide the expertise necessary to help you improve collections while safeguarding your brand. Any partner you choose should have readily accessible references that can vouch for their claims of success.
Choosing to outsource first party collections is an important decision, and one that requires careful consideration. When done correctly, outsourced financial care programs can help grow revenue while retaining customers who might otherwise be lost during delinquency.
To learn more about how EGS approaches first party outsourcing, visit our financial care page.
Publish Date: October 15, 2015 5:00 AM
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