4 Major Compliance Management Challenges and Their Solutions

Since the inception of the Consumer Finance Protection Bureau (CFPB), collection agencies of all sizes have been subject to a particularly rigorous set of compliance requirements. However, with the rollout of Regulation F, also known as Reg F, we have ushered in a new era of regulatory concerns. Now, in addition to staying on top of shifting regulatory guidelines, debt collectors must also be mindful of case volume, which seems to change with each passing week in the view of backlog from the CARES act. 

If you’re looking to succeed in the landscape and keep up with stringent regulatory requirements, here are the top compliance management challenges you’ll need to respond to immediately and in the future.

Common Compliance Management Challenges-1Challenge 1: Client or security certification audits take forever to complete.

Audits are time-consuming tasks. Without comprising on the length of the audit process (which typically includes examining audit questionnaires, reporting, SOP, and policy documents), client and security audits require you to check relevant documentation twice or thrice. The man hours required in complying with audits can be daunting to small and medium-sized firms that may not have enough auditors in-house or budget to carry out these manual exercises.

Solution: Having a centralized compliance management system
 that automates workflows and provides instant access to previous audits, cross-departmental actions, and automatically generated reports can significantly reduce the manpower needed for audits and ensure accuracy at the same time.

Challenge 2: Managing complaints and resolving disputes is a tricky business.

On average, collection agencies receive disputes on 10% of their accounts, and complaints on another 5% of their accounts. Resolving a complaint can take several hours, especially if it involves cross-verifying multiple departments. In the absence of automation around dispute and complaint management, agents may end up spending 25% of their time only on resolving complaints and disputes.

Solution: Automating the complaint workflow process can reduce the time spent on dispute resolution. This can enable stakeholders to direct complaints within no time to the right officers and provide the tools for quick resolution of complaints.

Challenge 3: Compliance training is a never-ending task.

Depending on your team’s size, team leads or compliance officers may end up spending up to 50 hours to manually train, test, and score agents. Not identifying gaps in training can pose potential risks to the company in regard to policies, procedures, client requirements, and the latest CFPB regulations, including Reg F.

Solution: Create online training modules into a SaaS-based compliance management solution to make them accessible to agents. All you have to do is to refresh internal compliance rules and all the relevant documentation as per new CFPB guidelines regularly and track completion of agent certifications in the system for the same.

Challenge 4: Maintaining policies and procedures is a labor-intensive job.

As CFPB compliance requirements continue evolving for the collection agencies, it takes substantial manpower and supervision to ensure that regulatory changes are disseminated agency-wide and every agent, dispute analyst, and QA professional within the company is up to date on the changes.

Solution: Switch to a centralized compliance management system so you can allow changes in policies and procedures to be disseminated within the company instantly. This should also help you track the acknowledgment of changes by employees.

Final Thoughts

You can’t afford to scrimp on security or compliance in a heavily regulated landscape such as credit and collections. Whether your workforce is remote, onsite, outsourced, or some combination of the three, an automated compliance management system can help you build a unified system for managing complex compliance to-do’s.

IPACS® is one powerful SaaS-based compliance management system that automates and centralizes key compliance tasks and can help you manage all compliance challenges mentioned above. Interested in learning more? Request a demo today!