Digitizing Debt Collection with Conversational IVR

Debt collection is a multi-billion-dollar market that is constantly growing across multiple verticals. As a result of the negative effects of the pandemic and the risk of a global recession, consumer debt is rising, contributing to this market’s growth.

The numbers also support this growth: Between 2022 and 2025, the market is expected to grow 2.8% annually, reaching $16.7 billion by 2025. While this presents an opportunity for market players, they need to find effective ways to overcome current challenges and compete effectively.

 

The Challenges of Traditional Debt Collection

Traditional debt collection methods that rely on manual processes are far from offering effective solutions. In addition to increasing the workload for agents, they also increase the risk of human error. According to Ernst & Young research, with this labor-intensive and, therefore, costly method, the success rate of banks ‘outbound collection campaigns stood at roughly 5%.

Debt collection requires a sensitive approach, and that's why understanding customers' needs and answering their expectations across any channel is crucial. The best way to do this is to provide more personalized and effective customer service, but manual methods don't cut it. 

 

Digitization: Why is it a must?

Digitizing customer services has been on the radar of banks for a while. Using digital solutions, they enable better customer engagement, automation-driven efficiency, and personalized customer journeys.

Similar benefits come with a digital debt collection process. First, using automated processes eases the pressure on collection teams. Second, having less manual work reduces the risk of human errors and lets them focus on more important stuff. Plus, letting customers self-serve boosts efficiency since it allows more customers to be handled with the same or fewer number of agents.

For customers who don’t prefer talking to agents, the digital debt collection process means an enhanced experience. With an automated process, they can quickly and easily get the services they need. With digital debt collection, banks can get to customers proactively at an earlier stage, which improves their financial health and drives long-term value.

 

Digitizing Collection Process with Conversational IVR: ING Turkey Case

ING Turkey is a subsidiary of the ING Group, with over 3200 employees and 150+ branches. The bank needed to automate its outbound collection process and offer a new customer journey by increasing digital channel interaction and enabling agents to focus on important tasks instead of repetitive work. That's when Sestek Conversational IVR came into play.

Sestek Conversational IVR is an IVR solution combining speech recognition (SR) with natural language processing (NLP) to replace frustrating menus with simple verbal requests. This technology allows users to interact with systems through natural speech instead of legacy touch-tone input.

ING Turkey now uses Conversational IVR for reminder calls when there is a delay in payments by credit users. Thanks to Conversational AI technology, ING assesses and decides the exact payment date with customers through the natural dialog interface instead of limiting them to one-way communication where a predefined expected payment date is offered.

By digitizing the collection process, ING Turkey is offering a simple and fast self-service solution that boosts customer satisfaction and agent performance. With less time spent on basic tasks, agents can take on financial advisor roles, especially for complex customer issues. Finally, being the first bank to use Conversational AI in collection processes in Turkey differentiates ING Turkey from its competitors.

With this project, ING Turkey got the following results:

• More than 50% of the collection calls are handled by Conversational AI
• Agent workload due to collection calls decreased by more than 50% 
• Collection calls that required 16 agents previously can be handled by AI now
• Approximately 3000 hours of agent time saved monthly
• Customers’ payment promises taken via digital channels increased up to 58% 

To learn more about this case study, click here.

 

Take Your Customer Service to the Next Level with Conversational IVR

Want to provide your customers with a smooth experience across multiple channels without breaking the bank? What if we told you we could boost customer service while cutting costs? You've heard it right- Conversational IVR can transform your business through advanced self-service.

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