Mis-traces by collection agencies are a rather large problem that consume a great deal of time and money as well as infuriate those that are continuously bothered in the attempt to glean errant contact information leading to high numbers of complaints. But what can be done by those in the industry to significantly reduce recurring mistakes?
Wescot and other debt collection agencies that are active members of the Credit Service Association (CSA, have experienced large volumes of data cleansing. Current figures reveal that upwards of 70% of newly loaded business requires cleansing when received. This reflects a 40% increase over figures produced in 2007 before the global economic crisis.
There are several reasons for the escalations in data cleanse requirements. Banks hit hard by the downturn were forced to make extreme adjustments in mortgage lending procedures. Loans allowing 110% of value have disappeared and offers providing interest-only have become extremely difficult to find.
These changes have led to more people losing homes, seeking rentals over purchases and living with family members instead of independently. This shuffling and destabilising of a once more stable customer base along with a continuously weakened economy has produced a challenge to debt collection companies like Wescot to locate goneaways.
Current strategies utilise a growing arsenal of smart-data systems for tracing customers which are actually just lead generators. Quite often, the data gleaned from such systems only works to compound the problem as erroneous debris is simply transferred from file to file.
Companies where debt originates, as well as debt buyers and debt collection agencies to whom they turn, have had to make adjustments to meet these new trace challenges. Wescot quickly made such adjustments to strategies employing cleanse and trace methods and is one reason they are one of the largest UK companies in the industry today.
Wescot registers well over 250,000 new debts from its clients each month so better data trace and management tactics have to be employed. The solutions that have been found to be successful include combining traditional and electronic trace methods to increase contacts. Once contacts are made, agents take extra time to find out why customers are financially unable to make payments. These issues are taken into consideration and repayment plans are created that adhere to present circumstances.
Innovation, attention and flexibility have been a successful formula for Wescot.