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CRIF Research on Debt Collection Practices

DEBT Euro iStock_000012870618SmallNew CRIF Decision Solutions’ research on debt collection analyzes key challenges and future market perspectives. Since the outbreak of the 2008 financial crisis, debt collection management has become one of the most pressing topics for financial as well as non-financial companies. While drivers vary, from worsening credit conditions resulting in a decrease in overall collection percentages and an increase of customers who “can’t pay”, to increased competition and need to improve the bottom line, overall debt collection has become more challenging.

An interview with Ubaldo Tambini, Consulting & Analytics Director of CRIF Decision Solutions:

Why are you undertaking new research on debt collection topic?

The “world of debt collection” is constantly changing. From previous studies it came out that a path of industrialization was underway and therefore, after three years, we decided to investigate deeper the current situation, in order to see what has changed and which challenges are on the horizon. For these reasons we are conducting various research and surveys in different countries.

What trends are you finding so far?

Well, there has been a giant leap in collection performance improvement with many financial institutions.  Much of this progress is due to:

  • Use of portfolio segmentation
  • Applying a customer-centric approach
  • Differentiating collection processes, such as by severity of delinquency
  • Taking action as early as possible
  • Streamlining collections organization structures, especially in operations
  • Strengthening relationship with outsourcers through strategic partnership approach.

Moreover, a path of industrialization is underway also in non-financial sectors, such as  telco/media and utilities who are  benefitting from best practices in financial institutions and adapting and evolving them towards their own purposes.

Despite advances, key challenges remain such as to align internal processes with strategies, increase automatization and be ready to respond to changes in legislation.

What do you think is the recipe for success?

While there is clear a  gap between top performers and the rest,  staying in the “best practice club” is not a foregone conclusion. In fact, a recipe for success does not really exist. But, from the findings of various research it has become apparent that to be successful you need to:

  • Invest in expertise and management (such as a strong growth in analytical skills)
  • Have “data-driven” processes in all phases (business information as a strategic lever)
  • Reduce the “time to innovation” through continuous “pilot” experiments while accurately considering all related impacts from financial and operational to the customer experience
  • Build up an operating model that takes full advantage of internal and external resources, using outsourcers as an “operational extension” of the company, rather than a mere external agency
  • Align technology infrastructure to support this evolution of management strategies which leverage data and analytics  to segment, automate and continually improve.

How can CRIF Decision Solutions help its customers to achieve this success?

We have gained a huge experience working on many projects worldwide in different industries from banking & finance to Telco/Media and Utilities. Our solutions involve consultancy, benchmarking, strategy and process optimization, predictive analytics, reporting and software solutions.

CRIF Decision Solutions focuses on  customers’ top priorities and how to address them in a continuous improvement process. Our analytical capabilities, our end-to-end debt collection solution “CLever” along with our debt collection expertise & services are innovative strengths designed for those who want to improve their collection performance.

For more information please contact: [email protected]

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