Running an in-house collections operation can be taxing on an organization. However, with the burden of delinquencies, it’s an inevitable and necessary aspect of lending. Like we say around our office: if you’re lending, you’re collecting!
One of the primary burdens collection departments and leaders have to be concerned with is the impact of regulations on their day-to-day and overall operations. In addition, efficiency is, and most likely always will be, a top priority. In our vast experience as a collections service provider, my organization has learned a thing or two about running a well-oiled collection machine. Today, I’d like to share the top three things that I believe all in-house collection operations should have in place to help them stay on the right side of regulations and run a streamlined and efficient operation.
- A Clear and Concise Policies and Procedures Manual
The first step in getting and remaining compliant with the regulations surrounding collections (i.e. TCPA, FDCPA, FCRA, UDAAP, etc.) is to ensure you have a well-documented, formalized policies and procedures manual. A well-defined manual gives your collections staff a guide and reference for the expectations and guidelines you have for them. It should be organized, repeatable, and easily accessible to all necessary personnel.
Your manual can serve as your verification to regulators—in the event that your operation ever gets audited—that you’ve implemented the appropriate policies to ensure your operation is following local, state, and federal regulations.
- Call Monitoring Software
Now, admittedly, monitoring your collections calls is not something that is mandated by regulators. However, the burden is on you to ensure your agents are not violating your company procedures and policies, as well as state and federal guidelines, putting your business at risk. To this end, I strongly suggest that you make call monitoring a part of your in-house collection operation. A policies and procedures manual is only as effective as the amount of proof that you can provide that your staff is in fact following said procedures. Call monitoring gives you proof that your policies and procedures are being followed. Likewise, it allows you to recognize situations when employees are not properly following the guidelines, so that you can address and correct any issues or potential violations.
- Autodialing Technology
Depending on the size of your loan portfolio, your member demographics, and the amount of risk your organization takes on, you could benefit tremendously from an autodialer. An auto-dialer allows your staff to make multiple call attempts to every one attempt that would be made on a traditional phone. For example, on average, our autodialer can make upwards of 100 calls per hour, compared to 40 to 50 per hour, at best, on a manual phone. Autodialing technology gives your collection operation the ability to be far more efficient and effective than you would be in a manual environment.
While this is certainly not a comprehensive list of all of the logistics and bureaucracy that go into managing an efficient and compliant collection operation, hopefully it will give you some insights into some of the things you should keep on your radar. Learn even more about industry trends and actionable ways that you can improve your in-house collections process in our free ebook, Collections: To Outsource, or Not to Outsource, That is the Question.