Recovery of past-due receivables is a critical issue for any financial institution. It not only affects cash flow, but also the perception of trustworthiness among customers. Although the traditional process of portfolio recovery can be slow and costly, the good news is that there are technological tools that make this process more efficient, fast and effective. In this article, we explore the 5 most common challenges and how technology can help you address them.

1. Locating Debtors: An Ongoing Challenge

Challenge:
One of the biggest obstacles in portfolio recovery is the difficulty of locating delinquent customers. Debtors often change their address, telephone number or even their city without notifying the financial institution. This makes the collection process extremely difficult.

Solution:

Technology can be of great help in locating delinquent customers. With the use of customer management software and geolocation platforms, institutions can track updated information in real time. These platforms not only allow them to know the exact location of customers, but also to cross-reference databases with other sources of information to obtain updated data, ensuring a more efficient collection process.

In addition, CRM (Customer Relationship Management) tools make it possible to record and manage contact information, which improves the ability to contact debtors, optimizing the recovery strategy.

2. Ineffective Communication: Generating Impact on Debtors.

Challenge:
Another frequent challenge is ineffective communication with debtor customers. Generic phone calls or emails do not always generate a positive response. Lack of personalization in messages can cause customers to ignore payment requests or not feel the urgency to settle their debts.

Solution:

Technology can significantly improve personalized communication with customers. Intelligent chatbot platforms and automated messaging systems make it possible to send personalized communications based on each debtor’s behavior and profile. For example, a chatbot can manage payment reminders, provide information on outstanding balances and offer payment options tailored to customer preferences.

In addition, the integration of these systems with social networks, such as WhatsApp, makes communications more direct, convenient and effective, increasing the response rate and improving the likelihood of payment.

3. Lack of Account Prioritization: where to start?

Challenge:
Financial institutions often face the problem of not knowing where to start when managing an overdue portfolio. Without a clear prioritization strategy, efforts may be wasted on accounts that are less likely to recover, leaving higher-risk debtors behind.

Solution:

Artificial intelligence and predictive analytics are key tools to solve this problem. Using machine learning algorithms, institutions can classify debtors according to their risk of non-payment, debt amount and other relevant factors, allowing them to prioritize recovery efforts.

These tools analyze historical data and payment patterns, and with that, provide recommendations to determine which accounts are most likely to be collected and which require more urgent attention.

4. Manual and Slow Processes: Eliminating Bureaucracy

Challenge:
The use of manual processes in portfolio recovery is a major cause of inefficiency. Lack of automation in repetitive tasks, such as sending reminders, updating records and issuing reports, slows down the process and increases the risk of human error.

Solution:
Automating repetitive tasks is one of the best ways to accelerate portfolio recovery. Specialized platforms allow you to automate payment reminders, account status updates, and the sending of invoices and legal documents. In addition, online payment management through integrated payment platforms makes it easier for debtors to settle their accounts quickly and conveniently, without the need for physical or complicated procedures.

5. Lack of Clear Indicators: Measuring Success.

Challange:
The lack of clear and measurable indicators on the performance of portfolio recovery strategies can make it difficult to evaluate results and make decisions. Without accurate data, it is difficult to know what is working and what is not.

Solution:
The use of dashboards and interactive reports allows financial institutions to monitor real-time key performance indicators (KPIs) related to portfolio recovery. Some of these KPIs include recovery rate, average collection time, and customer response rate.

Advanced technology platforms integrate these indicators into a single system, allowing managers and directors to make decisions based on accurate and up-to-date data. This optimizes decision making and ensures that the right strategies are implemented to maximize debt recovery.

Overcoming these challenges is possible with the support of appropriate technology and clear strategies.

Platforms such as those designed by Shareppy Internacional offer comprehensive solutions to digitize and optimize portfolio recovery.

Are you ready to transform your portfolio management? Contact us and find out how our tools can help you.