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Solutions to Top 5 Business Challenges of Public Sector Collections

Published: May 7, 2013 by Guest Contributor

By: Maria Moynihan

Reduced budgets, quickly evolving technologies, a weakened economy and resource constraints are clearly impacting the Public Sector, but it’s not all doom and gloom. Always with new challenges, come new opportunities.

Government agencies must still effectively run programs, optimize processes and find growth in revenue streams.   Below you will find the top 5 business challenges facing the Public Sector and municipal utilities today and ways to overcome them:

1.  Difficulty finding debtors

When asked to name the top challenge to their debt collection processes, governments most often indicate the difficulty in locating debtors whose whereabouts don’t in fact match information they have on hand.

Skip tracing with right party contact data is key to finding people or businesses for collections and there are several cost effective ways to do this – either through industry leading tools or by tapping into available sources like voter registration information.

2.  Difficulty in prioritizing debt collection efforts

When resources are limited, it is critical to not only focus efforts by size, but by likelihood to make contact and access debtors with an ability to pay.  Credit and demographic data elements like income, assets, past payment behavior, and age can all be brought together to better identify areas of greater ROI over others.

3.  Lack of data available

By simply incorporating third-party data and analytics into an established infrastructure, agencies can immediately gain improved insight for efficient decision making. Leverage on-hand data sources to improve understandings of individuals or businesses.

4.  Difficulty of incorporating tools to improve debt recovery

Governments too often attempt to reduce backlogs by simply trying to accelerate processes that are suboptimal to start with. This is both expensive and unlikely to produce the desired result. In the case of debt collection, success is driven by the tools and processes that allow for refined monitoring, segmentation and prioritization of accounts for improved decisioning.

5.  Difficulty in determining to outsource or continue to internally collect

While outsourcing to debt collection agencies is always an option, it may not be the most resourceful one, or in some cases, even necessary.  Cost to value considerations per effort need to be made by agencies and often, the most effective strategy is to perform minimal efforts internally and to outsource older or skip accounts to third party agencies.

What is your agency’s biggest business challenge? See what industry experts suggest as best practices for Public Sector collections or download Experian’s guide to Maximizing Revenue Potential in the Public Sector to learn more.

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Access our white paper to discover collections industry trends, outlooks for 2021, and the benefits of leveraging data and advanced analytics. Read more!

Published: February 18, 2021 by Laura Burrows

New challenges created by the COVID-19 pandemic have made it imperative for utility providers to adapt strategies and processes that preserve positive customer relationships. At the same time, they must ensure proper individualized customer treatment by using industry-specific risk scores and modeled income options at the time of onboarding As part of our ongoing Q&A perspective series, Shawn Rife, Experian’s Director of Risk Scoring, sat down with us to discuss consumer trends and their potential impact on the onboarding process. Q: Several utility providers use credit scoring to identify which customers are required to pay a deposit. How does the credit scoring process work and do traditional credit scores differ from industry-specific scores? The goal for utility providers is to onboard as many consumers as possible without having to obtain security deposits. The use of traditional credit scoring can be key to maximizing consumer opportunities. To that end, credit can be used even for consumers with little or no past-payment history in order to prove their financial ability to take on utility payments. Q: How can the utilities industry use consumer income information to help identify consumers who are eligible for income assistance programs? Typically, income information is used to promote inclusion and maximize onboarding, rather than to decline/exclude consumers. A key use of income data within the utility space is to identify the eligibility for need-based financial aid programs and provide relief to the consumers who need it most. Q: Many utility providers stop the onboarding process and apply a larger deposit when they do not get a “hit” on a certain customer. Is there additional data available to score these “no hit” customers and turn a deposit into an approval? Yes, various additional data sources that can be leveraged to drive first or second chances that would otherwise be unattainable. These sources include, but are not limited to, alternative payment data, full-file public record information and other forms of consumer-permissioned payment data. Q: Have you noticed any employment trends due to the COVID-19 pandemic? How can those be applied at the time of onboarding? According to Experian’s latest State of the Economy Report, the U.S. labor market continues to have a slow recovery amidst the current COVID-19 crisis, with the unemployment rate at 7.9% in September. While the ongoing effects on unemployment are still unknown, there’s a good chance that several job/employment categories will be disproportionately affected long-term, which could have ramifications on employment rates and earnings. To that end, Experian has developed exclusive capabilities to help utility providers identify impacted consumers and target programs aimed at providing financial assistance. Ultimately, the usage of income and employment/unemployment data should increase in the future as it can be highly predictive of a consumer’s ability to pay For more insight on how to enhance your collection processes and capabilities, watch our Experian Symposium Series event on-demand. Watch now Learn more About our Experts: Shawn Rife, Director of Risk Scoring, Experian Consumer Information Services, North America Shawn manages Experian’s credit risk scoring models while empowering clients to maximize the scope and influence of their lending universe. He leads the implementation of alternative credit data within the lending environment, as well as key product implementation initiatives.

Published: November 18, 2020 by Laura Burrows

Join our webinar on October 21, as expert speakers provide a view of the current collections environment and share insights on how to best adapt.

Published: October 5, 2020 by Laura Burrows

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