The challenge: Resolving debt of BNPL customers while lowering cost to collet
The client is a BNPL company serving millions of customers in North America, Europe and Australia that sought to lower its cost of collections or liquidations, primarily through speedy resolution of past due credit balances. Quickly resolving debt qualifies the customer to re-use their buy now, pay later service, engendering loyalty and preserving the client’s customer franchise.
The challenge was to provide customers with flexibility, control and choice – the very qualities upon which the client built its own business model. As the client was a new market entrant, they were also eager to build a culture of dynamic growth and demonstrate an innovative approach to business.
The client wanted a solution that quickly improved collections performance. Firstsource was selected by virtue of its extensive track record for improving debt recovery rates swiftly.
The solution: An omnichannel and data-driven collections approach
Firstsource implemented its Receivables Management Solution which improves borrower engagement using omnichannel communication that included text, email, social media and telephony. This white-label digital solution supports around-the-clock, non-intrusive customer engagement, backed by a dedicated team when needed.
Armed with real-time business intelligence, we implemented a data-driven approach to prioritize collections and customization of settlement options based on customer data. This led to the creation of engagement templates that delivered electronic messages using personalized subject lines and custom settlement offers. Borrowers were invited to visit an automated web portal that enabled self-service through an intuitive design, providing the customer autonomy and a sense of control.
We introduced predictive modeling to gauge propensity to pay, prioritizing our debt recovery strategy. AI-driven personas offered tailored repayment plans that engendered customer loyalty. This enabled a personalized approach to debt recovery that conveyed an empathetic tone, which was consistent with the client’s business culture.
The result: Delivering on improving efficiency and collections
Once implemented, the Firstsource Digital Collections Solution lowered the client’s cost-to-collect by 20% and delivered on a critical collections efficiency milestone. Six-month liquidations achieved 24% of placed balances as a result of Firstsource’s improved collections efficiency. By month four of the engagement, Firstsource had generated $3.6M in collections, addressing the client’s requirement for near-immediate collections efficiency.
The digital strategy implemented by Firstsource that featured multi-channel communication, intuitive self-service, and personalized customer engagement outperformed vendors that had two or more years of experience providing the client collections services. As measured through customer satisfaction surveys, customers who engaged the Firstsource solution expressed overwhelming approval of the client’s personalized approach to collections.