Applying the wisdom of the ages to modern collections technology

Proverbs are quite literally the wisdom of days long gone by. What possible use could they be today when more advice is dispensed each minute across Facebook, Twitter, Pinterest and Snapchat than anyone could possibly use in a lifetime? When it comes to optimizing the application of modern technology such as virtual agents, chatbots and other AI fueled solutions to the process of collecting past due accounts, it turns out there are several old adages that make as much sense today as they did when they were coined.
proverbs offer good advice in collections

Lord John Russell, a British Prime Minister during the reign of Queen Victoria, once said “a proverb is the wit of one, and the wisdom of many.” No doubt both wit and wisdom are required for a saying to be passed down generation after generation. But to survive, a proverb must also be applicable to the times. Obvious candidates for the dust bin of history include “a stitch in time saves nine” and “you can lead a horse to water, but you can’t make him drink”. When was the last time you took up needle and thread or led a horse anywhere?

On the other hand, some sayings offer such sage advice that they’ve made their way into the language of modern business. When I was managing a collections operation a few years back, I had some favorites that I’d use to make a point to our agents about effective collections practices.

If they had only paid attention…

Turns out that when pursuing payments from past due customers, it’s easier to get today’s automated “virtual agents” to apply the wisdom of the ages, driving even better results and lowering your operational costs.

Here are three sayings that offer especially apt advice for getting the most from today’s collections tools:


You can catch more flies with honey than you can with vinegar

There’s a reason the CFPB’s consumer complaint portal has more entries about debt collection than any other category – customers don’t like to feel harassed, bullied or treated rudely. Unfortunately, when collectors are under pressure to get results, they say the darnedest things! Check out these examples of vinegary collector statements from a recent segment on NBC’s Today Show:

“We hope you enjoy your Christmas because this might be the last Christmas for you if you don’t make a payment”

“We need to get some type of payment in right now, or else I will have to send local authorities to your address to see about locking you up.”

“She either comes to the phone or we have someone from St. Charles County bring her out for questioning.”

While threats like that may bring in the occasional payment, they are not even remotely legal. That’s why creditors spend significant time and money teaching collectors what they can’t say and monitoring to make sure they don’t.

Conversational technology applied to the voice and text channels will only say what you want it to say, 100% of the time. While you may not want all your messages to be sweet as honey, even a “strictly business” script and tone will be better at prompting payments, not lawsuits, than an emotional collector worried about making their number.


Fool me once, shame on you; fool me twice, shame on me

Accepting a customer’s promise to pay (PTP) at an early stage of delinquency is a good collections practice. The customer may not be able to cover an immediate payment, and many are not comfortable authorizing a post-dated check. And since most creditors find a PTP results in an actual payment 65-85% of the time, there’s really no shame in it. But what about 15-35% of folks who break that promise and their account continues to become further past due? The creditor must follow up to cure these accounts.

Taking another promise from such customers is a bad idea, but unless prevented from doing so by their collections system, weak collectors often do just that – shame on them. A well-designed conversational application won’t be fooled into offering the promise breaker that opportunity. Instead, it will steer the customer into an immediate payment or if there is a documented hardship, an appropriate forbearance agreement.


Well begun is half done

Finally, if your conversational application convinces a customer to make an immediate self-service payment, that’s a good start. But they may not always be sure they’ve done it right. You need to close the loop so they know the bill’s been paid and that the consequences of further delinquency have indeed been avoided. Think I’m kidding about this? In a recent survey, we found that 85% of consumers followed up on such transactions to make sure it was completed properly.


Many of us have been conditioned by the online shopping experience to expect a message confirming that our order has been placed. Because of this, if you don’t send a payment confirmation message, there’s a good chance you’ll be getting an inbound call from the customer checking to make sure they’re in the clear. This puts the cost savings you realized from using an automated interaction at risk.

While there may be a modest expense associated with sending the payment confirmation, it’s much less than the cost of an incoming call that ends up with an agent. And if your confirmation includes information about their next payment due, it can serve as a reminder that might prevent the same thing happening again next month. That’s not only well begun, but done as well!

Do you have a favorite proverb you apply to managing your business? Tell us about it in the comments.

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Brian Moore

About Brian Moore

Brian Moore, senior principal, industry solutions of Nuance’s Enterprise division, brings more than 30 years of experience in financial services, mortgage and collections operations and technology to the company. He is also our resident compliance expert, advising companies on the TCPA, FDCPA, TSR and other regulations impacting customer engagement.