3 Ways Digital Transformation is Reshaping the Collections Industry
As we’ve previously written, advances in Artificial Intelligence and Machine Learning are enabling advances in debt collection, including AI-powered collections and call centers. But AI and ML are not singularly driven.
Digital Collections as a Competitive Advantage
Agencies who are able to digitize their operations through AI and ML inherently become more agile and able to respond to changes in consumer behavior, regulatory compliance guidelines and fluctuations in economic and hiring trends. For example, McKinsey reports that lenders who find the right combination of digital-first customer support will experience longer-term customer loyalty and competitive advantage.
“The primary focus of AI-based collections is increasing efficiency and output,” says Provana’s Principal Architect, Love Chopra, in his recent article published in Analytics Insight.
With data-driven ML, agents can be more productive, and managers are more quickly made aware of coaching opportunities to ensure compliance. Not to mention AI-driven collections enables today’s digitally savvy consumers to self-service through easy-to-use apps.
3 Trends for Digital Collections in the Years Ahead
In his article, Rethink Debt Collection with AI and ML, Love shares three emerging trends that will distinguish the leaders in the pack:
- Trend #1: Digitally enabled collections will help identify potential defaulters. AI and ML-based collections can help agencies determine propensity to pay – i.e., who will resolve claims on their own and who needs proactive intervention.
- Trend #2: AI and ML will continue to enhance the customer experience. AI systems can recommend communication channels by consumer, optimizing opportunities to connect and collect.
- Trend #3: Automation will drive market advantage. A vast number of paper-driven processes remain in the collections industry. Shifting from analog to digital operations will no doubt streamline productivity and help agencies achieve scale.
Especially for SMB agencies who are looking to drive sustainable growth, digital transformation may just be the silver bullet owners have been looking for.
For more tips from Love on transforming your digital operations, read his full article, and subscribe to our blog for the latest updates.