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Digital Debt Collection – the Future?

Over the past twenty years the Internet has gone from being the preserve of tecchies and geeks to a global platform that just about every household here in the UK has access to.  The increasing use of the Internet has changed the way in which we work, rest and play and it’s hard to imagine that we lived without this fabulous electronic resource just a couple of short decades ago.  We do so much online these days – from shopping to banking to communicating, everything is available at the touch of a button.  We’ve quickly gone from using desktop computers to access the Internet to carrying it around everywhere with us in our pockets in the shape of a smart phone, meaning that we’re never more than a touch away from everything we need to access online.

Innovation in digital technology has come thick and fast, we use websites or software and apps for so many of our administrative tasks and dealing with debt is also available at the touch of a screen. It makes sense that automating debt collection by using digital tools is now an option so today we’re going to take a look at what this means.

The main job of a debt collector is to enable people to repay their debts in an affordable and convenient manner – the easier the process is, the less likely it is that the debtor will fall behind with regular payments.  A survey undertaken by Opinium in 2015 revealed that one in three adults in the UK would prefer to deal with their debt online so offering the option of creating a repayment plan online and then offering them help in managing their financial commitments if needed makes perfect sense in this day and age.

It seems that taking control of their finances while avoiding direct confrontation empowers people who are facing debts, rather than leaving them feeling isolated.  Offering the option to deal with debts online is a key issue when it comes to treating customers fairly.  Most people would prefer to communicate via email, web chat, texts or self-service options, rather than the traditional letter or telephone call.  Businesses that understand the best way of communicating with an individual in order to ascertain what they can afford to pay and how often they are able to do so are likely to experience a better overall outcome when it comes to collecting a debt or late payment. 

Breaking down the barriers when it comes to debt collection by offering a convenient online portal in an email or text message increases the likelihood of a payment arrangement being kept.  For so many people, having to speak to somebody about their debt can create a barrier to dealing with it promptly.

Business in the UK that offer a method for customers to deal with their debts digitally are more likely to recover the payments owed to them.  The digital method of debt collection can mean the difference between providing a good customer experience, rather than a negative one.