While 69% of consumers expect email and SMS outreach about their past-due accounts, only 27% have been contacted through these channels, according to Early-Stage Collection Trends in 2022, a study by Lexop, a Canadian-based fintech.
However, 46% of past-due customers received phone notices about their late bills in 2022. But 51% said the agent was indifferent or did not seem engaged.
In 2021, the Consumer Financial Protection Bureau issued a rule that debt collectors can contact consumers by email, text and social media, although recipients can opt out.
But 55% of those polled by Lexop would feel more inclined to pay late bills if they received personalized emails or SMS reminders showing empathy and a desire to collaborate.
Of those polled, 48% said they would like the option to make payment arrangements and 38% said they would like to make a minimum payment to show good faith.
In addition, 63% said the perfect way to pay a late bill is online via bank transfer or credit card. But 47% of past-due consumers have had to call customer service, mail a check, or go to the bank in person to make a payment, the study says.
Yet 33% see the ease of the payment process as an important factor in the customer experience, and 27% mentioned good customer service. The COVID-19 pandemic has driven these digital-first preferences.
Meanwhile, 32% experienced poor service from unsympathetic and rude agents. This has caused 71% to consider switching to the competition.
Of past-due customers, 38% were late because of a cash-flow shortage, and 48% agreed to prioritize late utility bills over other debts.
Lexop surveyed over 4,500 consumers across Canada and the United States.