The word 'service' in customer service has become obsolete. Why are customer service representatives irate? Clients tell me all the time about how debt collectors have called them at work and cause undue stress by upsetting them which results in loss in productivity and feelings of anger and frustration.
I was a debt collector in the mid-90s for 5 years for one of today's top credit card companies. I received numerous awards for being one of the most effective collectors in my department. Employee of the month, high commissions and bonuses were given to me because I practiced the following debt collection techniques:
- Don't take it personal.
Don't act like the debtor owes YOU money. The money is owed to the company and you are hired to attempt to get the funds due. The goal is to collect as much money, if not all, on the debt. The first step in effective debt collection is to NOT put yourself in the equation. The equation is debtor + creditor = collect the debt.
- Remove the negative attitude.
Having a negative attitude will only infuriate the debtor and reduce the chances of collecting on the debt. Obviously, there is a reason why the payment is past due, having a more positive attitude will increase the chances of at least making a payment arrangement versus creating a hostile situation.
- Use active listening skills.
The debtor's situation is already stressful; they will provide an explanation why the payment is late, listen intently and allow them to finish their sentences. Don't interrupt. Make statements like, 'I am sorry to hear that'….or 'Let me see what options we have…' will make the conversation less stressful on both parties.
- Focus on a solution.
Provide options for the debtor. The company's goal is to first collect the full payment. If full payment cannot be received, collect a portion of the payment rather than none. Aggravating the debtor by speaking in a condescending attitude will only add fuel to their fire. My motto was, 'collect some rather than none.'
- Use empathy and compassion.
Put yourself in the debtor's shoes. It is hypocritical to act as if you, the debt collector, have never been late on a debt or have never had to contact a creditor to ask for an extension or a payment plan. Identify with the debtor's situation and come up with a solution.
- End the call on a positive note.
After diffusing the situation by listening and devising a plan that is acceptable to both the company and the debtor, end the call on a positive note. Say something like, 'thank you and I hope your situation gets better.' It would be advantageous to setup a follow-up call a few days before the 'promise to pay' is made to remind the debtor of their obligation, determine if the situation has gotten better and that the payment will still be made as scheduled.
Debt collection is a difficult job, but somebody has to do it. If you want to increase your commission, reduce your stress level, and meet your quota, practice effective debt collection practices. You, the company, and the debtor will thank you for it.