An integral part of collecting debts is the trace procedure, which is why companies like Wescot are able to find the customers and begin the collection process. Given that the company will only receive payment from a client once the collection has been made, it is important that the trace procedure is as efficient as possible. Customer’s residency is a common issue with tracing as residency is far more fluid and transitional than in years gone by. With the rise in people renting as opposed to getting a mortgage, customers are able to move around a lot quicker, which makes for a large number of mis-trace results if data sources are not cleansed regularly.
Another significant change to the way that debts are collected is the switch from the Office of Fair Trading to the Financial Conduct Authority (FCA) as to which body regulates debt recovery and management. The FCA has enforced new rules regarding the image of the industry as a whole and how customers are treated once they have been found. ‘Goneaways’ is the term used for customers who cannot be contacted and it is estimated that 30-40% of those who have not replied are in fact a goneaway. The FCA has ruled that companies can no longer ignore a goneaway customer.
There is one important way in which companies such as Wescot can continue to thrive despite the fluid nature of customer residency, as well as not only abiding by the rules as set down by the FCA, but embracing them. Contacting customers is the only sure way to validate the data as presented by a credit reference agency (the common database provider that many debt recovery agencies use). A potential solution to this growing problem of goneaways is using a service that relies on live customer contact. This will ensure that the company is in line with the FCA’s requirements to improve customer service.
Tracing costs money as much as it costs the company time to complete a successful trace. By creating a new live customer contact product, debt recovery companies will see a greater improvement in a number of aspects.