Where do you fall on the SMS digital divide in lending and collections?
Both sides of that split need support, so we teamed up with our superhero partner Solutions by Text to talk about how you can drive more payments through text messaging with generative AI.
Nick Babinsky, Chief Product Officer, Solutions by Text
Shantanu Gangal, CEO, Prodigal
Justin Metacarpa, Senior Director, Business Operations, 2nd Order Solutions
Nick:
We at SBT believe that AI unlocks so much capability in terms of the results that you can drive for your business in terms of finding more opportunities to drive higher rates of engagement with your consumers, higher conversion, and acceleration of payments based on timing, personalization, profiling, and overall impact.
We are seeing this tremendous opportunity to supercharge our strategization, analysis of data, and the ability to form and inform our outreach approach to consumers via AI.
Justin:
Long-term, we believe gen AI is game-changing when it comes to credit, collections, fraud, and all risk prediction.
Nick:
Almost a third of all consumer debt in the United States today is now owned by people less than 39 years of age. And so we're seeing this transformation in terms of not only the debt landscape, but the preferences of how they want to be and how they need to be connected with.
Shantanu:
Consumers want to have the ability to deal with you in a way that they prefer, and to pay lower prices. Businesses want to operate at a lower cost.
Gen AI has really reduced the cost of doing business, and has increased how much all of us can serve a very, very personal outreach to our customers. And that in turn drives CTRs.
Using gen AI for digital outreach, we’ve seen clicks to the payment portal increase almost 30% and digital payments increase up to 43%.
Shantanu:
Using texting and personalizing the message in order to create affinity with the consumer allows you to tell them that you understand the situation. So in a very cost-effective manner, you build a relationship with them even before they've even clicked on the link.
And in order to do that, you need to say the right things and make sure that the text is seen.
I think the number I have seen was like close to 80% of texts are read within the first two hours.
What we want to do is get them read in 10 minutes.
All texts get read.
The question is do they get read when they're available to act on it? Or do they read when they are in the middle of 15 different things? If the message is read in the middle of 15 different things, being a lender or settling an outstanding debt isn't going to be their highest priority. They're going to want to respond to their friends or take care of some other work.
So it is not only important that you get the message opened, but you really care about the click-through.
Justin:
One of the things that we're seeing with most of the clients we work on is more of a servicing co-pilot: different prompts, different things around what agents can answer, whether it be a two-way SMS, or email, or on the phone where agents are getting prompts based upon what's going on to be able to know how to reply back.
Another thing which is slightly different is around being able to use ML [machine learning] to say what's the best time of day, what's the best day of week to contact these customers.
Nick:
The use case I'm most excited about is enabling consumers to complete the transaction within a conversation.
Shantanu:
You can close the loop within a minute if you’re able to deliver the text at a time when they’re able to make a decision.
Getting that is the magic of generative AI - if you use the right tool to personalize the right message, the right offer, and send it at the right time, it allows you to unlock crazy ROI.
We're expected to be severely underwater in the next 12 to 18 months, so for people who have multiple trade-offs that they need to make between vendors, services, banks, and so on, you need to be the lowest friction point.
Justin:
One of the things we're seeing our clients really start to make a difference on is not just being great at one channel in a silo but having them all build upon each other. The messaging in the SMS is similar to the messaging in the email, similar to what you see when you go online, similar to a phone call.
And then having that be in a place where it is based upon the persona or the segment, based upon the value or risk, and then based on the delinquency bucket. And that has been a key driver for us is not only being able to maximize return on texts, but maximize it across all the channels and letting them build upon each other.
Nick:
“We’re working less and saving costs and saving time because you see the automation now backed by smarter, intelligent solutions. We’re spending less human capital to produce better results.”
Justin:
If you can develop a really good contact strategy around, “Hey, I'm gonna call or email this many times, SMS this many times. Here's the time I'm going to do it. I'm going to vary that based upon the segment,” you can really start to be able to get the most efficient way of getting payments from your customers.
Then you can identify which ones are going to be less risky, more apt to be digitally engaged, and which ones are going to be more risky. Which ones may require different types of content, different types of tones, and different types of phone calls and SMS.
Shantanu:
The idea is to give you more returns from the data that you have, from the customers that have, your work in the book of business that you have.
.svg){kind=icon}
-min.png)
.jpg)
-modified.png)
.png)
.png)
.png)
.webp)
