Hi Tim, please tell us about your journey into technology space and how you started at InDebted?
I have always been an early adopter of technology. I remember I had one of the first cell phones, which came in a bag. From there, I bought one of the first PDAs, and I had a computer in the first law firm I worked at when other attorneys still used index cards. My love of technology in the accounts receivable space started 12 years ago when I saw customers coming to our website to “stop the phone calls,” so I had a customer portal built for them to do that. From there, we quickly updated it to allow them to give us their email. This process was unheard of at the time, even though email had been around since the late ’70s.
Jump forward to 2017 when I joined the first digital agency in the US called TrueAccord. This company focused on the customer first and communicated with them via email using a customer portal. The customer experience resulted in positive experiences for customers, and that caused fewer complaints and lawsuits. This process was also my first exposure to machine learning which is currently revolutionizing all industries. Today, I am part of the InDebted leadership team, changing the way debt collection works worldwide. We are doing what TrueAccord did in the US in AU, CA, UK, US, with plans to be in DE, FR, IT, MY, MX, and SG, and we are just getting started.
Imagine a world where people are not shamed into paying a debt, that they have the tools needed to make healthy financial decisions for themselves and their families. Someday we will have an AI bot that will help us stay on a firm financial footing, and the number of people in debt collection will drop dramatically. What a world that would be.
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Tell us more about the debt collection trends and how these have changed in the last 2-3 years, especially during the pandemic?
The number one change, thanks to the pandemic, was allowing people to work remotely. This was a fundamental shift from massive call centers with thousands of people to having to set up compliant infrastructures to enable people to work from home. In addition, before the pandemic, limiting access to personal identifiable information (PII) was deemed so crucial that people could not be trusted with access unless they were in an office setting.
In the US, there has also been a slow shift to other communication channels like email and text caused by customer adoption of smartphones that allow them to block phone calls. Right party connections are dropping every year, yet most agencies still try to control customers by calling them when it’s convenient for the collection agency. It’s like when Kodak film kept trying to get customers to use film because it was a better picture, but it was actually not what the customers wanted.
What kind of technology does one need to ease the debt collection/debt management processes? How does it help borrowers and lenders differently?
Debt collection is now in the control of the customer more than ever before. It’s what the customer wants that drives how well an agency will do. Most agencies don’t think of the customer first. They start with clients, then themselves, and then the customer. With this mindset, they invest the least in giving customers what they want, a 24/7/365 frictionless digital experience. It has to be mobile/cell first, as customers rarely want to talk with a real person. This is a dilemma for collections agencies with hundreds of thousands of people making and taking phone calls.
Most lenders are focused on the front end of lending, which is customer acquisition and not what happens to a customer that goes into default. For most borrowers, the borrowing experience starts online— it is a frictionless process and everything is good until they start missing payments. However, once a borrower has missed too many payments, their experience goes from digital to analog with phone calls and letters.
Going into this stage is like entering a whole new world where the lender does not even allow them to pay on the portal where they set up their account. Lenders start with customers and when they cannot repay their debt, they magically become debtors, and for some, the degrading process begins.
Every country has certain debt-regulation and compliance framework? Do you think using a technology-enabled platform would help streamline the process completely? What are the challenges in delivering a universally accepted platform for debt management?
Yes, there are certain debt-regulation and compliance frameworks in most countries but for some, there are very few regulations. Using a technology-enabled platform would definitely streamline the process completely—that has been our experience at InDebted. Our platform is built with a focus on the customer and our experience is that it is compliant in most countries as it is. The largest hurdle we face is language-driven, but that is something we are working to tackle everyday. There may be little nuance differences here and there but communicating with customers digitally is what customers want no matter where they live.
How do you use AI and machine learning in your product development? Any recent upgrades that have been designed specifically with AI ML in mind for debt platforms?
Our product development revolves around the customer – we use machine learning to ensure we can engage a customer using the right channel at the right time with the best message to help them take action on their account. We use machine learning to determine what channel (SMS, email, etc.), what template (what message – tone, language) and what time to contact each customer. This is informed by connecting historical data with behavioural data when a new customer enters the system. Part of our machine learning process is our template recommender, which provides a dynamic communications experience for each customer that is individually determined in real-time at each step in the collections process. We recently updated our template recommender to make sure we are getting the right message in front of the customer. This helps with engagement and gets customers back on the road to financial fitness. As we enhance our template recommender, we’ll better communicate with customers in different locations, demographics and behaviors with more relevant solutions based on data.
What is your general opinion of Fintech industry and how do debt management technologies fit into the ecosystem ruled by payments and wallets?
Lending and borrowing have become easier and easier over the last 3 years, yet the debt collection process has remained mostly unchanged. The ease of Fintech can be great for customers, especially those that did not have easy access to financial services before. It can also set up customers with the least amount of exposure to certain financial products for failure and result in them overextending themselves. This is a fintech opportunity that InDebted helps fill with our digital debt collection process and our future products.
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How fintech markets should focus on customer experiences? How do you deliver CX at Indebted?
While fintech is great at focusing on customer acquisition, there is not enough on customer experience when the customer needs it the most. This is where InDebted steps in to help fill this gap, making it easy to take care of their outstanding accounts using a customer-focused, digital-first, frictionless experience.
We deliver outstanding CX at InDebted by compensating our teams on customer experience measured by 5* google reviews, rather than a bonus on the amount of debt collected, which is standard in the collections industry. This traditional form of agent compensation based on revenue collected is misaligned with customer goals and can promote unfavourable outcomes. We remove the ‘pressure’ from the engagement – collector under pressure to collect and customer under pressure to pay. We deliberately decided not to incentivize our agents on collections revenue, as we want them to focus on working with customers to reach the best outcome for each individual customer, regardless of whether that is a payment or assisting them with questions. Additionally, our people + culture at InDebted sets an entirely new standard in the industry. We believe that the way we care for our employees manifests in the way they care for our customers. We’re progressive and people centric through the trust + flexibility we provide employees such as a four-day workweek, 100% remote operations, and a remote work stipend.
Please tell us about the biggest challenges and opportunities you met in 2021?
The biggest challenge is hiring talent to sustain our growth – we’re growing as fast as we possibly can in order to help more and more customers around the world. The opportunity for us is that InDebted is the only global player in debt collection and it is market for us to take.
Your predictions for the year 2022- what does your advice on how to build a solid fintech-based data roadmap for the coming year?
Easier and easier borrowing, especially in the buy now pay later (BNPL) space. Everyone wants convenience and the BNPLs are highly focused on that. With convenience, there will be more customers that overextend themselves. This will capture the eye of regulators and we will see an increased focus on protecting customers.
Your thoughts on leveraging AI, analytics and automation for developing world-class customer data solution?
Data is key to all of the above. Those that are capturing and using their data effectively will have a massive competitive advantage over those that don’t. Data is the new space race for business. Expect new SaaS tools that allow the use of data to go from something requiring significant expertise to being managed by anyone with access to the data.
Thank you, Tim! That was fun and we hope to see you back on globalfintechseries.com soon.
[To share your insights with us, please write to sghosh@martechseries.com]
InDebted is sublimating debt collection by leveraging machine learning to understand consumer preferences for servicing overdue accounts. We couple this with an exceptional customer experience to enable our clients to better support the financial wellbeing of their customers.
Backed by Carthona Capital and Reinventure, InDebted is one of the top-funded and fastest growing tech companies in Australia today, disrupting a multibillion-dollar global industry.
