FiSite Research, a research company that specializes in the online Financial Services sector, has just announced the results of a comprehensive survey regarding online bill collections services. The survey was conducted over a one-month time period and asked respondents a series of eight questions about online bill collections services. Overall, the results prove that consumers see online collection services as a better way to manage the collection process over the traditional methods of the past.
“Overwhelmingly, consumers have turned to online financial services to realize greater convenience and to save time. The results of the survey show that consumers see these same benefits accruing as they seek online tools to enhance their bill paying habits,” said FiSite President Paul Jamieson.
During the survey, it was explained to respondents that an online bill collection service will allow customers to enter a company website and make an electronic payment, send a message to the company stating the customer’s intention to pay the overdue bill or send a message to the company stating that a payment has already been sent. In the event that the consumer is not in a position to pay the overdue bill, the Website will offer an extended payment plan to satisfy the debt.
Throughout the survey, respondents consistently voiced a very strong preference for using an online collections service over receiving a call from a business representative or collections agent. In fact, more than 87 percent of respondents felt that an online collections site would be useful, allowing them access 24 hours per day, seven days per week. “Careless bill payers, those who pay some or even all their bills chronically late are seeking self-directed solutions that enable them to fix their late bill payments in order to avoid the embarrassment and emotional confrontation of human bill collectors,” said Jamieson.
Credit Card issuers lead the way in gaining benefits from online service
In addition to the consumer benefiting from the collections service, credit card issuers and a variety of consumer lending organizations that must collect bills from consumers have an expanded opportunity to reduce operating costs by automating collection procedures. Moreover, this enables collections agents to focus their efforts on those consumers who seek to avoid payments rather than wasting time, effort and money on those likely to self-cure through online collection services.
Another benefit is that issuers can more effectively communicate with their customers. Issuers can provide educational materials in a “financially supportive” tone in an attempt to gain budget-share of this cardholder who may well owe money to others. Some of these tools include: credit reports, financial advice, financial calculators and promotional offers.
Online Collections has come of age
One company has already seen the benefits of offering such a service to issuers and has recently launched a product called InSite™ Collections. Incurrent, based in Parsippany, NJ, developed InSite Collections based on extensive industry research. According to data from the Federal Reserve and Standard & Poors, credit card issuers have write-offs of about $45 billion this year, through the end of September. This is particularly significant, according to Bill Kinnelly, CMO for Incurrent, because of the millions that have been invested in the last generation of telephone-based technology that made it possible to contact clients. Consumers came back with answering machines, caller ID and call blocking, which severely diminished returns for telephone collectors.
InSite Collections provides delinquent accounts a web experience in which they can communicate with the card issuer about the details of their delinquency and become educated about the options available to them. Incurrent’s first customer, a major credit card issuer, feels very strongly that the online collections service will provide a substantial increase in payments at a lower cost to collect. In the highly competitive credit card industry, card issuers must consider softer methods to resolve bill collection issues. Using traditional bill collection methods have the potential of alienating customers when less heavy-handed collections can retain otherwise good consumers. “The survey just confirms where the collections industry is heading, and that, across the board, consumers find online collections as appealing. Not to avoid paying bills, but rather to have the opportunity to pay their bills in a less stressful way,” concludes Jamieson.
For more information regarding the survey, please contact Paul Jamieson, President & Director of Analytics FiSite Research LLC.
About FiSite Research
FiSite Research is a leading market research and advisory firm committed to supporting the development and implementation of online financial services and related technologies. The firm performs various research services including proprietary and syndicated market research, Web site assessments and competitive studies. FiSite publishes its insightful research in reports, market briefs, through Webinars, at industry conferences, through its Web site at www.fisiteresearch.com and in its outbound email newsletter, Active InSite.
About Incurrent
Founded in 1997, the Company numbers among its clients leading institutions such as MBNA Business Lending, Citibank, Target, Metris, Certegy and Fiserv. With 130 million card accounts under management, Incurrent’s InSite™ product line is among the most widely adopted electronic banking systems in use today. Fully integrated with all leading back-office accounts receivable systems, including First Data, Total Systems, Certegy, and PaySys, Incurrent represents a fast, cost-effective and low-risk means of providing Cardmember Care. Incurrent clients are consistently placed in the top of industry rankings based on site performance, stability, features, and ease of use.
