Collection Industry Tries A Different Approach In A Rough Economy
April 4, 2010 by Mallory Megan
Filed under Debt Collection
The Collections industry’s tactics may be taking a turn for the….better? Keeping in mind the number of recent lawsuits against debt collection agencies, ACA International, the largest trade group of professional creditors and collectors, claims more and more collection companies are working towards training collectors to take a more of an empathetic position.
Empathy might just be the gameplan that can turn the industry around. Many people in debt are being called by various collections agencies, and if they do obtain money, they aren’t going to want to give it to the aggressive threatening collector, they will give it to the person they can work with.
As agencies are perfecting training courses to include advice on how to be gentler with consumers, there will be a change of focus that includes being put on coaching, mentoring and counseling debtors, rather than aggressively threatening them. Trainees are urged to reflect on their personal experiences with collectors or someone that they know has dealt with them.
One recent trend has been to suggest that debtors speak with their parents or grandparents about taking out a loan against their life insurance policies or reverse mortgage against their house. The bill collectors who utilize this technique claim that our grandparents remember the Great Depression. They might not want this generation to experience that kind of pain and may be more prone to take a loan against the life retirement account or the life insurance policy.
Collectors who adhere to this philosophy think that it is in actuality a positive thing. They claim that it doesn’t hurt anyone. If a person borrows against life insurance it might be preferable to borrowing against a 401(k) or a retirement plan. That is because the person will be counting on that money to live on.
Wrong or right, it would do the collections industry some good to evaluate its situation, and look for new innovative ways to collect in a suffering economy.
Mallory McGuinness works for a debt collection company. She also writes articles on business, finance, the credit industry and collection agencies.
