How to maximize the effectiveness of calls in debt recovery: ten essential techniques

In today’s post, we will delve into a terrain that can sometimes seem like a maze of difficulties: calls in debt recovery. In the face of constant evolution of digital technology, one could fall into the mistake of underestimating the crucial role that telephone calls still play in the world of debt management. However, when well managed, these calls can become a highly effective tool for debt recovery.

The current landscape has exacerbated the complexity of telephone debt recovery. With the proliferation of call blocking, call screening and the consumer’s ever-increasing preference for digital forms of communication such as text messages or emails, making contact with the correct customer has become an increasingly elusive task.

In this context, it is understandable that making a collection call can be a daunting task. For credit departments, often swamped with work and understaffed, collection calls are often relegated to the bottom of the to-do list. However, in these times of economic uncertainty, efficient debt recovery is more crucial than ever to ensure stability and long-term growth.

This is where efficient call center solutions come into play. Improving collection methods through appropriate telephone strategies can increase the productivity of service agents and ensure the financial stability of the company. And it is precisely at this point that we want to focus today. Next, we will present you with the techniques that will help you maximize your call center solutions and increase debt collection.

Debt collection tips that get results

Although reaching consumers becomes increasingly challenging, which can lead to rush in some calls, success does not lie in quantity but in quality and attention in each interaction. Instead of rushing to the next call, the most successful professionals adopt a deliberate approach, avoiding pressuring the consumer and potentially losing a debt they were willing and able to pay.

Making collection calls can be a challenge, stepping out of people’s comfort zone due to fear of failure or embarrassment. However, by implementing appropriate techniques, it is possible to carry out debt collection effectively.

1. Prepare before you call

Before making a collection call, it is vital to adequately prepare and familiarize yourself with the person you are going to call. This preparation involves understanding the details of the debt, including the terms of sale, the goods or services purchased, the amount owed, the due date, and any other unpaid invoice. Reviewing the customer’s payment history with the company and any payment default can help discern whether this is an isolated incident or a pattern of behavior. Having all relevant information at hand maintains authority during the conversation and avoids unexpected deviations. It is essential to balance the collection of sensitive information with respect for the customer’s personal boundaries, employing empathy and courtesy to establish a constructive relationship.

2. Approach calls with positivity

The attitude with which you approach a collection call is vital, as it is reflected in your voice and can influence the direction of the conversation. Your mental state can affect both your handling of the situation and the customer’s response. Therefore, it is important to maintain a positive and respectful attitude, treating each call as if it were the first of the day, and taking a moment to calm down after a difficult call. An optimistic attitude can be contagious and foster more positive responses from the customer.

3. Be direct and concise

Effectively managing a collection call involves brevity, courtesy, and direct communication strategies. These techniques include addressing the customer by their name, validating their feelings, asking open-ended questions, and taking notes. The use of silence can encourage customer participation, and keeping the focus on debt payment can prevent deviating from the subject. If the customer becomes irritable or abusive, staying calm and suggesting a new call at a more appropriate time can be helpful. A few seconds of silence can also help to defuse a tense situation, allowing the conversation to continue more productively.

4. Personalize your calls

During a debt collection call, it’s essential to personalize the conversation and seek a commitment from the customer, whether for a full payment, partial payment, or a specific date to return the call. At the end of the call, it’s important to summarize agreements, set expectations, and consequences in case of non-compliance. This review helps reinforce the urgency of the situation and demonstrates your seriousness in following up on the payment.

5. Handle objections

Effectively handling objections is crucial in debt collection calls, requiring understanding and effective responses to customer concerns. Since every customer is unique, there’s no universal strategy, and active listening is key to understanding how to effectively approach collections. Negotiating for the highest possible payment and reevaluating how payment plans are created can optimize accounts receivable and provide suitable solutions for consumers. Offering customers realistic solutions to free themselves from their debts can build trust in you and your agency, and often alleviates the distress associated with paying overdue bills.

6. Use the right language

The use of assertive and positive language can establish a better connection with customers during collection calls. Your tone, pace, and voice inflection can have a significant impact on how the listener perceives you. Preparation and practice, such as recording yourself reading your call script and adjusting it as needed, can improve the way you present yourself and increase your confidence. Useful tips for effective communication include speaking slower, enunciating clearly, frequently pausing, and smiling during the conversation. These tips can significantly improve your telephone skills, giving you the authority to effectively direct the conversation.

7. Ask and listen

In the process of debt collection management, it’s crucial to ask pertinent questions and listen carefully to understand the customer’s needs and capabilities. This approach aims not only to obtain a payment but also to understand the debtor’s situation and collaborate to find a viable solution. By asking appropriate questions and practicing active listening, valuable information about the customer’s willingness to pay is obtained, the relationship is strengthened through empathy, and debt resolution is facilitated.

8. Offer solutions

In collections management, the main objective is to offer solutions. This involves understanding the debtor’s financial situation and proposing options that fit their circumstances. Given that every debtor has a unique situation affecting their ability to pay, it’s vital to adopt a flexible and empathetic approach to facilitate cooperation. Attention should be paid to what the customer has to say and suggest potential solutions until a plan that benefits both parties is found. By focusing on providing effective solutions, not only is the debt recovered, but a positive relationship with the customer is also maintained, facilitating future interactions and potential collections.

9. Close with a call to action

The conclusion of a collection call should encourage the debtor to act. This essential step could involve reminding them of the next payment, confirming an existing payment agreement, or requesting a response from the customer. If the call has been fruitful, a new meeting can be scheduled, additional information can be sent, or a deal can be concluded. Once agreed upon, it’s necessary to summarize the payment plan for the debtor, including the schedule and method of payment. Don’t forget to keep in touch with the debtor, even if they can’t settle the installments immediately, they might be able to do so in the future, and by maintaining open and attentive dialogue, an early payment can be facilitated.

10. Learn from every call

Lastly, it is crucial to consider every collection call as an opportunity to learn and improve. After each interaction, reflect on the aspects that worked well and those that require adjustments. Using these learnings, you can continue honing your recovery skills. Don’t despair if you don’t see immediate results; just like any art, effectiveness in collections management requires practice and patience. Persevere and keep improving, and over time you’ll see significant advancements in your telephone sales recovery.

Tools to improve collections

In the current digital era, communication technologies can enhance the effectiveness of collection calls. Automation of payment reminders and communication cycles is one way to save time and increase the likelihood of successful collections through tools such as:

• Messages and emails: This method accelerates the payment process and encourages greater consumer engagement in resolving their debt.
• Automated dialing: This can increase productivity in debt collection by reducing downtime and increasing connection rates.
• App-based and web-based payment options: These can make payments simpler, faster, and more secure, automating the debt collection process and improving the customer experience and collection effectiveness.

Finally, it is essential for collection agencies to adapt to the latest customer-centric technologies and opt for high-quality cloud-based solutions that integrate customer information from various sources for efficient tracking of the collection process.

Implementing a centralized debt collection system can optimize efficiency, while the use of artificial intelligence and machine learning can identify valuable patterns and trends in call data. An example of such technologies is Upbe, which offers automated analytics and real-time monitoring, enabling significant optimizations in customer service performance and debt collection efficiency.

Our experience with one of our clients resulted in an 8% increase in collection rates. If you’re ready to take your call center to the next level of efficiency and success, don’t hesitate to contact us.