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Case Studies Transforming Collections Management

Transforming Collections Management

Improving the collection processes across a multi-brand banking organization

Background

The Challenge

Our Solution

Results

In the clients words

Collections-Case-Study-Header-2

Our client faced the challenge of reorganizing and streamlining the fragmented and manual collection processes across its subsidiaries and brands. The existing collection process primarily relied on a single channel of communication, via the telephone.

3.3m

corporate & retail customers

Global

multi-brand presence

300

branches

The CHALLENGE

Fragmented Process

The existing system was largely fragmented, with different banks, departments and teams using disparate processes and tools for managing collections. This fragmentation resulted in inefficiencies, data discrepancies, and increased operational costs. Moreover, the reliance on manual processes, particularly through telephone communication, posed limitations in terms of scalability, customer reach, and overall effectiveness.

Key Requirements

  • Streamline fragmented collections processes
  • Replace manual workflows with automated systems
  • Enable multi-channel communication
  • Centralize data for consistent reporting insights
  • Improve scalability for growing collections demand
  • Reduce errors from manual data handling
THE CHALLENGE

Key Challenge Areas

One of the primary challenges faced in the collections management transformation was enabling the collections process to be undertaken through multiple channels. The traditional approach of relying solely on telephone communication for collections proved to be limiting and inefficient.

Manual processes were time consuming and resource intensive. Collections agents had to manually review and update customer information, record payment details, and track collection progress. This not only consumed valuable time but also limited the capacity to handle a large volume of collections cases effectively. As a result, the bank faced difficulties in scaling its collections operations to meet increasing demands. Needless to say this also raised the risk of input errors and inconsistencies.

Fragmented processes impeded effective data management and analysis. With collections data spread across different systems and formats, consolidating and analyzing the data on a comprehensive level was a significant challenge. This hindered the bank's ability to gain valuable insights, identify trends, and make informed decisions regarding collections strategies and resource allocation. The lack of standardized data also limited the accuracy and reliability of reporting, making it difficult to assess collections performance and monitor key metrics consistently.

OUR SOLUTION

Establishing a Solution

To overcome these challenges, we implemented a solution using the Pega platform, which offered the ability to create and manage customized workflows tailored to the specific business requirements. This unified process could be exposed to all four brands, allowing for efficient, well-informed decision making, minimizing the risk of human error.

DELIVERY

A Phased Approach

When a customer falls behind on debt repayment for a secured loan or mortgage, a case is created in the system. The system then sends out omni-channel notifications to the customer, including text messages, emails, and letters, to inform them of the issue. This triggers a series of events, providing the customer with options to resolve their debt, such as making a promise to pay the full amount on a future date or setting up a payment plan.

If the customer does not opt for a payment plan or promise to pay, the case is assigned to a collector responsible for following up with the customer. The assignment of a collector is based on predefined rules, considering factors such as workload, skillset, spoken language, and location. The collector offers the same solutions as the automated process but introduces an income and expenditure form. The system then utilizes business logic to determine the best outcome and solution for the customer.

If the customer fails to respond to initial follow-up activities, the case is automatically escalated to a higher authority based on predefined criteria, such as the amount owed or the age of the debt.

When the customer makes a payment, the system is automatically updated, and the case is closed. The system records payment details, updates the bank's accounting systems, and generates receipts or invoices. In the event of a broken promise, where a payment plan has been agreed but not adhered to, or a promise to pay has not materialized, a senior collector is notified. They initiate a more serious collection process, such as conducting a house valuation for mortgage debt recovery.

WORKING TOGETHER TO FIND A SOLUTION

Identifying the challenge

Initial considerations

  • Manual operational processes
  • Limited system integration
  • Fragmented data architecture
  • Constrained scalability

Delivered results

  • Automated intelligent workflows
  • Integrated enterprise systems
  • Unified data platform
  • Scaleable automation framework
Results achieved

Real Results Delivered

50%

reduction in onboarding time

2.5x

increase in revenue growth

82%

increase in employee retention rate

In conclusion, the implementation of our solution has transformed the collections process, improving efficiency, reducing errors, and most importantly enhancing the customer experience. By streamlining collections through automation, banks can lower operational costs and increase revenue whilst maintaining and improving customer satisfaction.

Improved efficiency

By leveraging process automation and adopting an omni-channel communication approach, significant efficiencies were achieved in the collections process. The implementation of automated systems and streamlined workflows resulted in a reduced reliance on advisers throughout the entire process, leading to substantial time savings.

Enhanced Customer Experience

Empowering customers to manage their own debt without the need for constant intervention from an advisor has proven to be instrumental in enhancing the collections process from a customer’s perspective. By providing customers with the tools and resources to take ownership of their debt, they are more motivated and proactive in addressing their financial obligations.

Enhanced Customer Care

The reduced reliance on advisers throughout the process allowed an allocation of more time and attention to cases that demanded their expertise. This enhanced their effectiveness in handling complex situations, negotiations, and providing personalized support to customers when necessary. 

Increased Revenue

Overall, the revenue increase resulting from a faster collections management process showcases the ability to optimize cash flow, reduce financial risks, and maintain strong customer relationships. By prioritizing efficiency and effectiveness in debt recovery, the bank has successfully translated its collections efforts into tangible financial gains.

“Leading with integrity and openness, powered by AI”

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John Smith

CEO, De Volksbank

“Leading with integrity and openness, powered by AI”

Lorem ipsum dolor sit amet consectetur. Lectus nulla lectus venenatis ac netus. Est ac viverra vel amet elit posuere sagittis elit. Donec id porttitor augue blandit. Massa tellus convallis interdum nec odio amet sed. Morbi quam purus elit risus nec tortor tincidunt sit quis. Tellus facilisi tempus id accumsan id arcu ac massa venenatis. Commodo aliquet erat commodo porttitor faucibus consectetur rutrum amet. Facilisis arcu volutpat consectetur nunc diam. Nam ut nisl ut feugiat semper. Aliquam at nibh ut est facilisi habitant. Orci cras mi tincidunt elit venenatis convallis gravida ridiculus.

John Smith

CEO, De Volksbank

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