Taking a digital approach to debt collection is becoming more mainstream across the world. By harnessing the powers of software which is powered by Artificial Intelligence (AI) and Machine Learning (ML), the overall debt collections performance can be improved, and creditors and customers alike reap rewards. Here we outline the top five ways debt collection uses AI and machine learning.
1. Digital Communications.
An important study by Swiss multinational UBS, published in January 2018, found that 52% of all consumer financial transactions now happen online, making digital the definitive channel of choice for financial communications. Using AI automation the debt collection process has also evolved to meet the digital demands of the customer. Organisations can now automate their debt collection team’s communication processes. Through an automated, omnichannel communication process, debtors can be contacted via email, WhatsApp, text message and postal letter.
2. Finding the Perfect Time
In addition, the best debt collection software which leverages the power of AI and ML can also recognise and present the optimum time of day for any digital communications to be sent, and also the best channel by which to reach the debtor. This increases the likelihood of a response, and collection rates are improved.
3. Business Intelligence and Analytics
Companies are also working to integrate artificial intelligence and machine learning into their strategies in order to make improvements when it comes to business intelligence and analytics. These complex algorithms process large sets of data about matters such as call effectiveness, the value of certain accounts and collections rates. The data is analysed and strategies for optimisation are presented. For example, machine learning mechanisms can generate the best strategies — focusing on those debts that are more likely to be collected on, and presenting what times of day or channels work the best.
4. A Single View of Debt or Single View of Customer
A “single view” of a customer or debt is an incredibly powerful, innovative tool. Government agencies and local councils can now possess a “single view” of all the different debts that an individual owes. The powerful models and algorithms of artificial intelligence can help organisations make sense of the vast amount of data they have, and this can be the first step in a more progressive, nuanced, detailed approach to the collections process.
5. Chatbots and Human-Like Communications
Artificial intelligence debt collection software can be used to create human-like ‘voices’ and incredibly personalized experiences for debtors. As consumer preferences shift more towards digital channels, machine learning tools can help to optimize omnichannel communications, as emails, texts, and voice calls — which can be used to extend and optimise the outreach of the collections process.
Artificial Intelligence continues to create a constructive disruption in the collections industry. And AI and ML offer the foundation for building a whole new approach to successful collections. Get in touch with Lateral today learn more.