When customers pay late it has real costs to your business. Not only is your cash flow delayed, but chasing customer payments has operational costs.
The majority of customers simply forget to pay, but late payers can easily turn delinquent resulting in increased cost of debt collection.
Oxygen8 Business Solutions are designed to speed up late payments and reduce the cost of collection.
Research suggests that text messaging could be one of the most innovative and under-used communication channel for payment reminders. 94% of text messages received are read by the recipient.
Paying the Price for Late Payments?
Managing profitability has become a key challenge for many businesses.
Not least is a substantial increase in late and delinquent payments. Risk management and collection processes have always been crucial but never more so than now.
Its not just the Financial Services Sector suffering from the cost of late payments. From Utilities, such as Gas, Water, Electricity and Telecoms; to Internet Service Providers, Cable TV and Entertainment companies. Indeed, any company that takes regular payments is at risk from the damaging effects late
payments can have on a business.
Did you know?
- 19% of Aussies pay their bank, credit card or personal loans late.
- The average is 13 days late
(source Pocketbook April 2014)
Knock-on Effects your Customers
Would it surprise you to know that the majority of customers do not intend, or even want to, become late payers?
The knock-on effects are significant in terms of:
- Financial penalties for late payments
- Detrimental effects to credit scores
- Affect on future borrowing capability
The truth is that most customers simply forget to pay a bill by the due date, resulting in your business incurring a series of costs simply to remind them to pay a bill which is overdue, as well as impacting your business’s cash flow.
Negative experience of the collection process may actually cause them to move to one of your competitors.
Not only is your business now bearing the cost of bad debt and poor cash flow but at this stage it is also bearing the cost of new customer acquisition.
Did you know?
- Retail Banks
- Mortgage Lenders
- Credit Card Issuers
- Insurance Companies
- Utility Companies
- Telecoms Companies
- Internet Service Providers
- Cable TV & Entertainment Companies
- Estate/Travel Agents & Rent Collection Agencies
- Local Authorities
In fact, any company collecting regular payments from consumers
How Does It Work?
“One bank reported more than a 400% improvement in collections efficiency by adding text messages on a limited basis to its collections strategy.”
How can companies improve their collections processes, whilst decreasing business costs and keeping customers happy?
Understand Payer Behaviour – which customers are unable to pay and which just forgot? Sloppy payers frequently miss payments not because of a lack of funds, but due to simple disorganisation.
Use Multiple Channels to Maximise Contact – use a variety of channels and messages to maximise response.
Decrease the Cost of Collections – using live agents to call customers for collections dramatically increases the cost of collection and using direct mail to send out reminder letters is expensive with no guarantee of receipt.
Increase business efficiency – just how many of your reminder letters end up in the bin? Using voice and text communications, you can instantly see online who has received your bill reminders and who responded.
Improve Customer Satisfaction and Retention – customers that forget to pay on time will appreciate the opportunity of being reminded before they incur penalties. Customers will see this as a value added service and with less complaints about late penalty fees, your customer retention will be higher
Be Proactive, Don’t Wait Until It’s Too Late – good collections processes begin before a customer misses payment. Be proactive in communicating. Schedule automated voice, text, or email reminders when bills are due.
Keep the Message Simple – concise contact through a variety of channels will yield results.
Improve Cash Flow – by speeding up late payments, you improve your business cash flow. The quicker money is received, the quicker your business can re-invest.
Better Management Information – with online statistics and immediate calls to action, you’ll be better able to understand your customers’ payment behaviour.
Improved Environmental Footprint – these days, everyone is focused on improving environmental footprint and cutting down on unnecessary paper. Telephony and messaging solutions can cut out the need for paper communications.
Why Choose Oxygen8 to help with your Collections Process?
- A complete range of services which can help your business improve its Collections Processes
- From text messaging solutions to voice broadcast systems, Oxygen8 has helped other companies to save money within their Collections Processes and improve their cashflow with exceptional returns on investment.
- Cost effective to implement and little upfront investment required, enabling your business to fast track implementation.
- Scaleable and flexible whether you are a global banking enterprise or a small rent collection agency.
- Simple APIs to integrate your enterprise systems quickly and efficiently and our management dashboards give you instant access to the information you need to run your business.
- Whether you operate in Australia, or internationally, Oxygen8 can help. With connectivity to over 150 countries and offices in 10 territories, Oxygen8 has true global coverage.