Economic Uncertainty Spurs New Challenges in UK Debt Collection Agencies

Discover how debt collection contact centres can improve agent performance and drive enhanced customer outcomes

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Economic Uncertainty Spurs New Challenges in UK Debt Collection Agencies - CX Today News
Contact CentreNews Analysis

Published: May 4, 2023

John Flood

John Flood

Debt collectors get a bad rap.  

Consider the fact that collection agencies and financial institutions have been taken to court in recent years over allegations of overreach and unfair and abusive practices.  

In 2020, Lloyd’s Banking Group was fined £64 million for failing to treat mortgage customers fairly after they fell into financial difficulty. 

Such an example is one of many, driving reputational damage among debt collectors. This has led to the widespread misperception that debt collectors are unscrupulous operators bent on harassment and aggressive tactics with people who have fallen into payment arrears. 

The truth is more nuanced. The facts are that debt collectors are often in the difficult position of assessing why a person is in arrears while looking for a reasonable plan to get the loan holder back on track.  

Today, the debt collector in the contact centre is highly trained in trying to find a way to help people out of debt by giving clients options they might not know they have. 

“Debt collection is a very tough topic right now, said Ben Booth, CEO of MaxContact. “The UK is going through a severe economic crisis.  

“The cost-of-living crisis has made life remarkably challenging for millions. Customers owe businesses money, and companies need to be paid or face going out of business.”

Meanwhile, Financial Control Authority (FCA) regulations have intensified. 

“New FCA regulations require debt collectors to handle vulnerable clients fairly, and they need to be able to prove it,” Booth said. “They can do that by embracing technologies like speech analytics because that’s the only way you can do QA and handle the massive volume of calls.” 

When The Electricity Is Cut, a Dialysis Machine Stops

Energy companies face a big challenge. The economic crisis in the UK was made worse by the significant rise in energy costs. Consider this scenario: 

A vulnerable client struggling financially can’t pay her electricity bill. Cutting off her power can spell terrible consequences, especially for dialysis patients. 

“I spoke to a debt collector with an energy firm last week, and this one shocked me,” Booth said. “He said, there are many personal challenges that people we speak with face every day, like dialysis machines. We’ve got to listen for clues like that. If we turn off the power, a client could die.” 

Speech Analytics Can Help Detect Vulnerabilities

AI-based speech analytics plays a vital role in the lives of vulnerable people struggling to keep up with their debt payments.  

With the latest advancements in machine learning (ML) from MaxContact, contact centre agents can quickly look for clues into their clients’ financial, emotional and physical challenges – like a dialysis machine at home. 

With the latest advances in AI capabilities, companies now have relatively low-cost means to summarize calls, look for specific topics and improve call quality.  

ML and AI make agents more efficient. Management can more easily identify and address problems. The customer experience is better, and the agent is less stressed and more effective. 

Delivering More Empathy with MaxContact

MaxContact’s speech analytics technology product can help debt collectors to understand the intent of debtors’ communications.  

Information can be used to personalize communication, identify and prioritize cases, and track and measure performance. 

For example, MaxContact can analyse a debtor’s phone call to determine the reason for the call and detect tell-tale signs of vulnerability. This information can personalize the conversation and focus on the most critical issues for the debtor. 

It can also identify patterns in debtors’ communications to identify cases most likely to be successful and prioritize those cases. 

It can track and measure the performance of debt collectors to identify areas where they can improve their performance and collect more debts. 

Economic uncertainty in the UK has spurred consumers into higher and higher debt levels. Millions of people are struggling to keep up with no end in sight. 

Meanwhile, increased FCA regulation increases pressure on debt collection agencies to meet new regulatory compliance and prove that they handle vulnerable clients fairly. These are extraordinary challenges for debtors and debt collectors. The good news is that there is a way forward. 

Click here to learn more about how MaxContact can help make your debt collection teams more effective. 


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