How Can Banking Groups Deploy a Collections and Recovery Solution?

Collections and recovery (C&R) are changing. Gone are the days when a simple phone call or touchpoint was enough to collect. Now, customers and clients are multi-channel and often have multiple debt obligations. They generate more, and more sophisticated, data than ever that impacts the risk on a bank’s books.

This new landscape means that banks need specialized, sophisticated collections software to cope with tough markets, stiff competition, and increasing regulatory pressures. These specialized solutions offer unprecedented insight into risks and customers that help organizations capture more revenue from existing credit obligations.

Banking groups in particular face unique challenges when it comes to selecting a reference collection and recovery solution, including:

• Implementing a reliable system across subsidiaries and countries that support best practices in C&R.
• Easily configure a system for country-specific needs and regulations.
• Drawing a balance between monitor and control from headquarters, and autonomy in subsidiary operations. 

It’s clear that banking groups have different needs when it comes to C&R. But how do they find a solution tailored for their specific operations?

What Is the Solution?

Best practices guides, also known as blueprints, are the best way for banking groups to manage bad debt and C&R activities across subsidiaries in different geographical locations.

The blueprint approach provides:

• A framework of best C&R practices.
• A system to implement this framework. In the case of EXUS, we provide a pre-configured version of our collections and recovery software, EXUS Financial Suite, which is compliant with a banking group’s guidelines and best practices.
• A structured methodology for implementing these practices on the preferred C&R system.

A blueprint is not a set of pre-designed C&R strategies to be implemented by all subsidiaries. It is a framework for designing these strategies.

This framework is tailored to the environment, capacity, portfolio, and IT infrastructure of each subsidiary. It sets the principles that should be respected by all credit-providing entities—regardless of their size and country of operation. 

Additionally, it doesn’t have to be restricted to a banking group’s business strategy or technological infrastructure. It can also span the relationship between headquarters and countries, C&R maturity of individual countries/subsidiaries, or back-office systems unification and consolidation.

Benefits of a Blueprint Approach

One of the major benefits of a blueprint is the ability to select a blueprint that spans different key operations, including: 

• Business specifications, including common strategies and/or workflows that support the business operations of each subsidiary.
• Interface specifications, such as common specs that relate to the collections software and the back-office systems of each subsidiary.
• Technology and infrastructure requirements for all subsidiaries.
• Functionality and tools required to support all subsidiaries.
• Implementation methodology that includes common roles, project management methodology, project planning, risk management, project governance, testing methodology, contract management procedures and more.
• Reporting specifications, including common specifications and key performance indicators (KPIs) for all subsidiaries.

Once applied to any one of the above operations, the blueprint approach offers benefits for an entire banking group that includes: 

• Excellence in C&R for all the group’s members, regardless of their size and related expertise.
• Rapid deployment of C&R best practices.
• Economies of scale.
• Improved efficiency and decreased effort from the bank.
• Implementation of internationally tested and acknowledged collections strategies.
• Compliance with group guidelines.
• Foundation for future enhancements from other implementations.
• The reduced total cost of ownership (TCO) for the group and each country. 

How to Implement a Blueprint 

A blueprint-based C&R implementation must be able to be deployed with flexibility and scalability in mind.

That includes being able to support multiple application instances running in the same infrastructure. This way, multiple installations with different portfolios, currency, languages, etc. can be hosted under the same physical or virtual server(s).

EXUS has partnered with banking groups to implement blueprint-based C&R systems that have provided headquarters and subsidiaries with systems that substantially increase collection results, support local and group KPI monitoring, and show ROI just months after implementation.