Still don’t know which collection strategies for delinquent customers work best? Recovering debts is quite a complicated job and this difficulty increases if we come across delinquent clients. Therefore, it is important to be prepared to know how to deal with this type of problem and begin to recover what was borrowed.
There are two important factors that you must consider to start with your collection strategies for delinquent clients. The first is to recognize what types of debtors exist . In this way, you can create messages focused on each case you have. A debtor who does not have liquidity is not the same as another who simply does not like to pay.
The second factor is to prevent a client from becoming delinquent . Any collection campaign should not only have as its objective the request for debt collection. It should also focus on preventing debtors from reaching that level. Therefore, it is always important to give this approach to create an effective collection strategy .
Additionally, we can say that a software for telephone collections is important to complement the work of your agents. For example, filter only valid numbers from your database .
You already know what you need to know and that is why we will guide you from the collection strategies for delinquent clients that you must apply, what to do when a client becomes delinquent and how to prevent it. Let us begin!
For better management, it is important that the agent has collection software that allows them to label users according to their payment commitment.
5 collection strategies for delinquent clients
As mentioned in the introduction to this article, recovering debt is not an easy matter. Even less in the case of users with prolonged debt. However, this is not something impossible. Next, you will know 7 strategies that will make your life simpler.
Create unique messages for each type of debtor
To optimize collection processes, it is important to know what type of delinquent customer you are dealing with. Not everyone is the same and you need to know why you missed your payment date. In this way, a collection speech can be created for each one , depending on the situation in which they find themselves.
Therefore, it is important that you use a collection platform that facilitates access to customer information during a call. In this way, the collection agent will not lower their productivity levels, since they will not waste time looking for customer information .
Although all the collection strategies for delinquent clients can be implemented individually and by choice, I recommend that you implement this one on a mandatory basis. If the types of delinquent are not known and we adapt a message to each one of them, there will be no north towards which to walk.
Set new payment plans
Every collection strategy has among its tactics to make debtors’ payments more flexible. However, this changes when it comes to recovering debts from delinquent clients. For example, payment dates can be much more flexible, but they are fixed. In other words, there is a commitment from the client to come yes or yes to pay what he owes.
Extreme cases can also occur during collection campaigns for delinquent customers. For example, if the debt is a large figure and the client does not have liquidity or payment capacity, personalized payment plans must be created that suit their economic profile.
For better management, it is important that the agent has collection software that allows them to label users according to their payment commitment. Thus, the information will be updated in a more effective way in your database.
Create communication plans
When you already have new payment dates, the next thing will be to deploy a communication plan so that the client does not forget the payment commitment. All collection strategies for delinquent customers must be supported by a communication plan that keeps the user aware of what they owe and when to pay.
A classic way of making payment reminders is through text messages. In fact, a study found that 82% of consumers keep their SMS app notifications on their phone turned on. This is somewhat interesting, as despite the new means of communication, text messaging is still seen as a good alternative.
For this reason, it is important that you have software for your SMS campaigns that allows you to monitor in real time the sending of mass messages or for each client. In addition, it allows you to talk to the user through a two-way chat.
Sending SMS is one of the collection techniques for delinquent customers that is still successful when it comes to making payment reminders.
Establishes unique processes for defaulters who do not respond
If the debt collection request is not being answered by users, then it is time to take stricter measures. However, this does not mean that the debtor should be disrespected.
For example, a key action is to make the debtor aware that if he does not make his payment, his credit reputation will be damaged. If the user becomes aware that his credit future will be affected, he will take the necessary measures to remedy your problem.
Implement an omnichannel strategy
Unifying your collection messages in all your communication channels is very important. For this reason, start an omnichannel strategy so that you send all the debt information to each user.
Also, with an omnichannel platform , you can integrate chatbots to WhatsApp or another channel. In this way, the debtor will be able to provide self-service and faster access to key information such as the payment date or the amount of the debt.
You already know the collection strategies for delinquent clients that you must apply. However, neither the company nor the user wants to go this far. Therefore, below, you will learn how to avoid delinquent customers.
How to reduce the risk of delinquent customers?
Next, find out the steps you must apply to prevent your debtors from being delinquent. Remember that this should also be part of your collection strategies for delinquent customers.
Be clear on your terms
When a debt is acquired, the conditions must be clear and without loose questions. For this reason, the speech that your collection agents have must be well detailed in the following aspects:
- payment terms
- Collection methodology
- collection periods
In addition, it is important that the collection policy is adapted to the target audience you direct and according to the financial competition that exists in the current market.
Telephone or SMS collection strategies are good. But there are also other means that increase the reach such as WhatsApp or mail.
To recover debts it is important not to leave behind the monitoring of payment dates. Therefore, it is important that you make preventive calls to users. For this, you can use collection software that helps you filter the numbers of debtors based on their payment date.
In this way, you will offer a more personalized communication to each of them.
Digitize your collection process
Telephone or SMS collection strategies are quite good and should not be ruled out. But today there are also other platforms that will help you improve the reach of your messages.
With an omnichannel platform you can send personalized messages to WhatsApp or email to your customers. Everything from one place. In this way, you will have greater control of the entire management of your collection campaign.
Create payment strategies
Just as there are many collection techniques for delinquent customers , there are also preventive techniques that encourage the payment of debts. Within these we can implement:
- Deduct part of the fee for each advance payment.
- Offer bonuses for punctuality.
- Expand and facilitate all payment methods.
- Make all payment dates more flexible for responsible customers.
You learned the main collection strategies for delinquent clients and how to prevent a user from being delinquent. The next learning step is that you know how to act in a case of non-payment.
What to do if a delinquent user does not pay?
Even if you apply all the collection strategies for delinquent clients, there is always a small probability that there will be users who cannot pay their debt. Given this critical circumstance, there are only two last steps that we must proceed to reach an agreement with the user.
Start negotiating debt
To know how to collect a debt it is important to negotiate with the end users. When a collection in arrears is not made, the agents must be put in contact at the same moment. In this way, it allows knowing what are the reasons why the payment was not made.
The main reason for non-payment is that the customer forgot to pay or did not see the SMS reminder. However, what would happen if the client cannot pay due to lack of money? Faced with this problem, measures must be adopted that adapt to what the client needs. For example, you can do the following:
- Delay payments: Ask the client how long it will take for them to be sure that they will be able to pay what is pending. Depending on your response, the schedule should be rescheduled again.
- Divide the payments: In case the payment of installments is very high, the option of dividing these amounts or creating minimum payment processes can be given. In this way you ensure a part of what you should be paying month after month.
Remember that recovering debts does not have to be a cumbersome or annoying process. It’s all in how well you can negotiate or dialogue with the user.
Use legal processes
This is the most critical part of any debt collection application. In case the user does not want to pay, you must resort to the legal instances of the country where you are. It should be noted that this instance is only used when all paths have been exhausted for wanting to help the end user.
As much as it is an unwanted process, look for exit routes with customers. That way they won’t feel completely abandoned.
You already have the collection strategies for delinquent clients written down, how to prevent a client from being delinquent and what should be done in case the situation becomes critical. I hope that this publication has helped you improve your collection strategy and that you can meet your goals.