With both companies data-driven and sharing mutual clients, the collaboration aims to operate in a framework “that could benefit clients from a cost, experience and reputation perspective”, according to Experian.
The collaboration will enable clients to access InDebted’s digital, self-serve platform and customer service team, with “Experian’s capabilities of providing a single customer view, automated decisioning and security compliance”.
Lenders would see Experian’s technology identify customers that would benefit from InDebted’s self-serve platform or speak to their team, and transfer the appropriate data to InDebted.
Mathew Demetriou, general manager of decision analytics at Experian AU/NZ said: “Our focus is using the power of data and analytics to provide clients with an appropriate and tailored collection service for each of their individual customers, in turn helping them recover debt in a more cost-effective way.”
“In adverse economic environments where many customers are left with reduced incomes and are finding it harder to pay off debt, several lenders and debt collection agencies are often trying to collect from these same customers at the same time,” added Mr Demetriou.
“InDebted’s service aligns with a lot of the same objectives as our PowerCurve Collections solution, so it made sense to join forces to further benefit both of our clients,” he concluded.
Josh Foreman, founder and CEO of InDebted, added: “We’re all about using data to identify a customer’s preferred communication method and deliver the right message at the right time. Our self-service portal lets customers resolve their debt without needing to speak with anyone, which relieves the embarrassment that often comes with such sensitive conversations.
“This approach, together with providing customers with achievable payment plans instead of threats has proven to substantially improve collection rates for our clients.”
Experian’s recent Global Insights Report has highlighted that 43 per cent of Australian consumers are struggling to pay their bills, specifically on utilities (19 per cent), credit cards (15 per cent) and mortgages (14 per cent).
Through its credit bureau, Experian has indicated that many of the consumers who entered COVID-19 related hardship arrangements have appeared to currently be in the same position.
Australian businesses have continued to face further challenges, with collections teams still under pressure to support customers in complex situations and potentially long-term financial challenges.
This has driven over three-quarters (76 per cent) of Australian businesses to put plans in place to help manage their customers out of arrears stemming from COVID-19, with 65 per cent having directed between 7-20 per cent of their resources to help manage their customers out of collections.
However, the businesses that were surveyed felt their existing analytic models around identifying and managing customer collections decisions were less effective than those around credit risk, according to the data.
“In adverse economic environments where many customers are left with reduced incomes and are finding it harder to pay off debt, several lenders and debt collection agencies are often trying to collect from these same customers at the same time,” Mr Demetriou said.
“Lenders need to improve their efficiency but also treat customers fairly, so gaining a better understanding of an individual’s specific circumstance and identifying which collections and repayment solution is right for them is vital. The quicker you establish the most appropriate action for the customer, the better the outcomes for both lender and individual and the higher likelihood of customer retention.”
Mr Foreman added: “Without the ability to differentiate between portfolios down to the individual account level, traditional agencies can spend a lot of time managing simple cases instead of focusing efforts on complex debts, which is inefficient and costly for lenders.
“Sometimes, customers can miss payments for reasons such as a mismatch on billing dates or they are reliant on reminders to keep up to date – these are small risk incidences and do not need a collector chasing them when a digital self-serve option can cater better and speed up the process too,” he concluded.