Credit Management
The facilitation argument By Paul Burgess*
Paul Burgess
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Where would we be without the services of collection professionals? With the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry barely cooling, we are seeing an interesting shift in the consumer collections space. Financial Hardship assistance has been in this space for some time, and there is a plethora of written material on the subject. What is of interest is the way in which financial services to consumers is being viewed, and how these organisations are reacting to the spotlight. As I work through the consumer lease environment, I am seeing complaint after complaint hit the desk of the Australian Financial Complaints Authority (AFCA) in the way in which collections are conducted. With the requirements of disclosure to the consumer, there is an education revolution happening. Customers know good collections from bad collections.
This means there are more educated consumers that are in the market than ever before. It is then conceivable that if your collections systems and processes have gaps in them, these educated consumers could tear apart the effort and cause the organisation to lose cash. Financial Hardship assistance makes sense from the organisation’s perspective, from a bottom-line perspective, but this should not be the driver to providing this assistance. The customer is very important in the cycle, and by working with the customer and their changing life circumstances, builds a better market and can make a huge difference to someone’s life. It could be a life changing experience. By not providing the assistance to the customer as the main driver could also be a life changing experience, for the negative. Having said that, there is a need for organisations to ensure they are protecting their cash flow. To marry
“Financial Hardship assistance makes sense from the organisation’s perspective, from a bottom-line perspective, but this should not be the driver to providing this assistance. The customer is very important in the cycle, and by working with the customer and their changing life circumstances, builds a better market and can make a huge difference to someone’s life.”
CREDIT MANAGEMENT IN AUSTRALIA • May 2020
