Accounts receivable management firms are accelerating their digital push over the next 12 months. That’s the key finding of our recent pulse survey of ACA International Annual Conference attendees and other ARM executives.
To offset regulatory constraints and decreasing effectiveness of phone calls, collectors and creditors are relying more on written communications to engage consumers and recover outstanding debt. While our survey shows that mailed communications remain a must-have, more companies are emphasizing digital.
Current state of digital
The ARM industry has some catching up to do. Among our survey respondents, 84% receive less than a quarter of payments electronically.
Collection and credit firms are farther along with meeting customer preferences for omnichannel communications: 72% of respondents now offer a combination of digital and paper options.
Interestingly, many ARM firms are behind some of their peers in adopting digital customer communications management technology so they can control and expedite content changes to letters and other communications. For nearly half of respondents, it takes 2 to 4 weeks or longer to make compliance or other updates. These delays leave them vulnerable amid the fast pace of changing regulations, client demands and economic forces.
With Reg F officially sanctioning electronic communications and more consumers preferring digital interactions, respondents plan to step up these efforts over the next year:
- 90% expect to increase email
- 60% will expand text messaging
A full 80% also expect to expand electronic payments.
The shift among consumers to mobile and digital billing is clear and compelling. According to the 1H 2022 ACI Speedpay Pulse Survey:
- 51% prefer digital billing statements with another 29% preferring a mix of paper and digital.
- 38% prefer email payment alerts, 20% want text alerts and 11% want mobile app alerts.
Similarly, 85% of Americans make electronic payments for at least some of their monthly bills, according to the May 2022 PYMNTS survey of 3,000 consumers.
Digital bills, especially those that include links to payment portals, offer greater convenience and ease of use for many consumers. People often appreciate the flexibility of online self-service account management and payments, especially when they can set up payment plans and recurring payments.
For collectors and creditors, electronic communications lower overall printing and postage costs. Together with online payment portals, they can prompt consumers to bypass more expensive calls, too. Digital interactions, including text payment reminders, can reduce missed and late payments while texting past due reminders can also prompt action, both of which improve cashflow and recovery rates.
Getting started or expanding digital
The complete survey results are available in the ebook below. For more information on optimizing collection communications and payments, see our other resources:
- ARM Firms Plan to Increase Digital Communications and Payments eBook
- Gain Control of Your Omnichannel Collection Communications white paper
- CFPB Spurs New Credit Reporting Rules for Medical Debt Collectors
- Debt Collectors Need Flexible Customer Communications Management Systems to Comply with Regulation F
To learn about our industry-leading cloud technology and managed service for omnichannel communications, integrated with digital and print/mail services, please contact us.