This document discusses five vital elements of an effective collections process: 1) Starting collections at the point of lending with cooperation between risk, acquisition, and collections functions. 2) Ensuring accurate and frequently refreshed customer data is collected and used. 3) Leveraging technology like collections software, dialers, IVRs, and various communication channels. 4) Developing a data-driven collections strategy that is continuously improved. 5) Training and incentivizing collectors, ensuring they understand products, legislation, and providing a good customer experience.

1. Collections
Five Vital Elements
Stephen Bint; Head of Collections, HRAM & Customer Management

2. 1. The start of Collections
• Collections starts at point of lend
- Collection Friendly Lending
 Terms & Conditions
 Systems
 Documentation
 Product pricing– Rarely includes
cost of collections
• 3 C’s
• Character, Capacity, Collateral
• Close and continuous cooperation
with risk & acquisition functions
- Credit Policy
 Risk appetite
 Segmentation
 Graded cut-offs
 Living breathing document
- Segmentation
 Application/Behaviour Scorecards
- Suite to match different
lending types
- Statistically driven – Better
than rules
- Exception Management
 Control/Measurement
- Risk based pricing
 Graded approval amounts
(Value/Term) to Manage Risk

3. 2. Data
• Accurate & Recent
• Maximum data gain at
application
• What we need for
today….but more
importantly for
tomorrow
• The responsibility of
all personnel
• Incentivised
• Regularly Refreshed
• Obsolete data
removed
• Know your customer
• Contact media
• Preferred channel,
time, date.
• Key financials
• Income &
Expenditure
• Salary date &
Frequency
• Date of other
commitments
• Life changing events
• Birth, death,
marriage
• New or
Unemployment
• House move
• Define your Management
Information
• Measure, review, adapt, measure
• Daily, weekly ,monthly, quarterly
• Call centre performance
• Campaign Penetration &
completion
• 1st party/3rd party contact rates
• Promise of payment
• Bad data, Remove it, trace and
replace
• Cash recovered
• Cure Impact of cash on arrears
• 3rd parties performance
• DCA, Lawyers, Internal suppliers
• Strategy
• Review, champion-challenge,
measure results,
change/implement…or not

4. 3. Technology
- Collections software
» Proprietary/In house developed
» Joined up within and between departments
• Benefit of data refreshment
• Coordinated
- Dialler
- When to use
» Volume campaigns
• Pre delinquency, Early/Soft collections, Promise confirmation
- When not
» Personal assignation, Corporate, Employment telephone number campaigns
- IVR
» Can replace part of volume campaigns I.e. Pre-delinquency /Promise reminders
» Virtual & remote agents
» Voice biometrics (security and fraud)
- Messengers, Apps, e-Mail, On-Line Banking, ATM, Statement Messages
» Every opportunity to communicate
» Record customer preferred method
» Record ‘best response’ method
- Stay ahead of tech trends

5. 4; Strategy
Chicken/Egg; Rules/Data
- Data driven
- Initially “common sense”
» When sufficient exists
» Escalatory and non-repetitive
- Segmentation
» Time on Book
» Time account open
» Risk assessment
- Collection scoring
» When viable – Until then rules/proxies/risk based score
- Champion Challenge
» Continuous improvement
» Internal/External

6. 5; People
- Trained
» Collection Skills
» Objection Handling
» Escalatory scripts
» Boundaries… What can
say/do/grant/waive
- Know Products & Services
» How they work
» T&C’s
» Opening hours
» Payment channels
» Processing times/speeds
- Know legislation
» Lenders rights
» Customers rights
» Advisory bodies
- Well led
» Inspirational Managers,
Team Leaders
- Know what is expected, and what
to expect
- Incentivised
» Fair salary
» Challenging but achievable
bonus/commission system
» Linked to gains for the
institution
» Working Environment
» Targets
• Monthly, Quarterly,
Annual, Departmental,
Institution level
- Tools
» Fees/Discounts
• Charge and Waive
• Settlements
» Escalatory
» Legal Action

7. 6; Customer Experience
Availability :
Records, People, Help
- Human
- IVR
- Avatar
- On Line
- Telephone
- Instant Messenger
- Mobile
- Smartphone
- Apps
- Post
- e-Mail
- Branch
- Opening Hours
- Language
- Payment Methods
Approachability
Fear, Anger, Frustration
Empathy
Willingness to listen
Acknowledge we have heard
Confirm we understood
Doesn’t mean we will give them the
answer they want
Adaptability
Solutions for client problems
Restructuring/Forbearance
Interest rate manipulation
Simplicity in documentation,
communication & process
Customer know what they signed
Simple language (written
communication)
Easy to read statement
Highlight key information
Amount to pay
When to pay
How to pay
Know your Lender
How to contact
Multiple methods
When to contact
Circumstances
Pre-delinquency
Post-delinquency
Independent advice
Who to contact
Personal Banker
Collections representative
Direct line
Trust
Will do what they say they will…Can be positive and
negative…But it is clear & fair
Follow Through! - It might not be pleasant,
but you cannot “cry wolf”

8. Stephen Bint – Permanent tsb