Digital receivables management for telecommunications companies
Telecommunications services are a typical mass market business. Nearly everybody uses at least one telecommunications provider, often more than one – not just for landline telephony, but also for mobile phones, internet connections or web hosting services. This results in a massive number of customer relationships with regular payment obligations. Normally, invoices are paid on time – but unfortunately not always. This is where debt collection comes into play for telecommunications companies.
Defaulted payments and debt collection in the telecommunications industry
A study carried out by management consultants Deloitte suggests that around 800,000 outstanding customer payments result in collection cases in the telecommunications industry every year. Around 300,000 of these end up with debt collection companies. Each telecommunications company employs an average of 76 people in collections, with an average outstanding amount of 135 euros. Telecommunications companies lose around 30 million euros to unrecoverable debts every year using conventional debt collection methods. These figures make it clear how enormously expensive payment issues can be. Not only do they involve high levels of costs for reminders and collection processes, there are also losses from unrecoverable debts, which puts a strain on liquidity. Even transferring debts to debt collection companies is generally a loss-maker.
Reminders and debt collection also have an unpleasant “side effect” that the customer relationship itself becomes tarnished. This is primarily true for the “traditional” methods of debt recovery, which are often perceived as threatening and intimidating to the customers affected, who often end up attempting to move to a different provider. But this is not what the company behind the collection process wants. All it wants is for the outstanding telephone charges to be paid and to retain the client.
PAIR Finance – debt collection for telecommunications companies and ISPs
This is why PAIR Finance offers a digital solution in the debt collection sector. It is a perfect match for the telecommunications industry, which is now very much digital-oriented too. In terms of debt collection for telecommunications companies, it makes no difference to PAIR Finance whether the company is a network operator, a service provider or another kind of online provider. It is not only about simple, quick and efficient online processes, but also about the use of artificial intelligence and optimum approach strategies. These are the key things that set us apart from the “traditional” negative image of debt collection. The probability of unpaid invoices being settled should also be increased. In most cases, there is no ill will behind an unpaid telephone bill, there are just difficult financial circumstances. Instead of threats and intimidation, PAIR Finance aims to offer the client simple instalment plans, which are provided early and simple to agree online, to put the client in a position to pay the outstanding invoice. Persuasion, fairness and simple processes are the most important factors when collecting outstanding monthly fees. This approach is often more effective, no less sustainable and offers a better prospect of retaining the customer despite the contact with a debt collection company.
An innovative digital-based approach
PAIR Finance’s approach to defaulting customers is based on psychology rather than pressure. We use the latest behavioural research findings combined with artificial intelligence. Instead of an impersonal, standardised approach, we use a personalised approach strategy which takes the personality and behaviour of the debtor into consideration. This is based on experience, which shows that a personal, tailored approach is generally more likely to make the debtor inclined to pay. This is implemented based on self-learning algorithms, which systematically analyse the digital data available for the client in question. The self-learning principle means the system refines itself over time, making the collection process even more successful for telecommunications companies. At the same time, it avoids the conventional threats, so the customer no longer has the feeling they are not wanted – on the contrary, they are retained as a customer.
The subtle difference– how debt collection works at PAIR Finance
Based on the analysis of the digital behaviour data, the defaulting telecommunications customer is assigned to specific groups for which differentiated approach strategies have been developed. Each approach strategy is geared towards the highest possible level of success. Depending on the behaviour shown, the approach can be more “cooperative”, “forceful” or “logical”. But the tone is always fair and engaging. The PAIR Finance concept also involves providing the clients with simple, easy ways of settling their unpaid bills. The aim is to make it as easy as possible for them to “get rid of” their payment problem. This also includes open communication and immediate response to customer queries and concerns. As telecommunications companies and ISPs now largely communicate with their customers online, the digital approach taken by PAIR Finance involves no changes in media format, which considerably increases the prospects of success.
Benefits of PAIR Finance for the telecommunications industry
These is an overview of the benefits of debt collection via PAIR Finance for telecommunications companies:
- Outsourcing claims management to a “professional” who knows the business inside-out
- Consistent digital processes make debt collection more cost-effective, quicker and more efficient
- Artificial intelligence and findings from behavioural research give PAIR Finance better prospects of success
- Reduction of losses from unrecoverable debts, and improved liquidity
- Customer retention despite debt collection thanks to the fair PAIR Finance principle
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