Credit card debt collection looks very different than it did only a few years ago. Professionals are still exploring this new world, looking for and walking the fine line that is profitability in a jungle of regulation. This issue of Collection Advisor we shine the Agency Spotlight on SIMM Associates and find out from Co-Founder and COO Jeffrey S. Simendinger what he does to manage collection professionals and keep a collection floor productive.
How did you become involved with SIMM Associates and collections?
I am one of the cofounders of SIMM and have been involved with it since day one. I started in collections as a part-time collector employed by MBNA while attending the University of Delaware. I was later offered a full-time position in MBNA's Customer Assistance Department which was a fancy name for collections. I worked my way through the delinquency buckets and within a short period of time I was working in their backline pending charge off area. My father who is the other cofounder of SIMM has been in the industry since the late ‘70s. He managed the Collection Agency and Attorney networks for several large issuers. We decided to go out on our own and SIMM was created.
What is something you do to ensure things run smoothly on the collection floor?
Contests and recognition are some things we do to ensure the staff doesn’t become complacent. Communication between management and collection staff is also a critical piece. Contests keep collectors sharp and motivated. It’s a very tough job these days with all of the required client and regulatory disclosures; plus the quality assurance and compliance initiatives which are now more important than overall performance. It’s a different industry than it was seven to eight years ago. Those agencies that didn’t or couldn’t adapt found themselves struggling. I cannot stress how important communication is to the health of a collection floor. Information from clients, analytics, compliance and quality assurance helps collectors understand what is required of them, as well as how well they’re performing.
What do you think is an often-overlooked mistake that would guarantee failure in credit card collections?
I think not truly listening to the consumer is a huge failure for any type of collections. Every consumer’s situation may be different and to take a cookie cutter approach to rebuttals and objections is just not a smart way of handling collection calls. We teach and train our staff to “qualify” each and every consumer so that we truly understand their particular situation. Knowing what occurred that put them into financial hardship as well as their financial wherewithal and their ability to make repayment helps us offer solutions. Building a rapport with the consumer goes a long way.
Could you describe specific tactics you feel are necessary in credit card collections?
As I mentioned earlier, today’s collection call is much different than it was previously and it’s so very important to take advantage of every right party contact. This can be said for every asset class but when you’re dealing with an unsecured credit card account, repayment is normally very low on the priority list for someone that is having financial hardship. Typically mortgage, rent and car payments are going to take priority rather than paying on a delinquent or charged off credit card. With that being said its imperative to embrace technology specifically for those clients that allow email, text and other communication methods. Working with a proven data provider to be able to utilize batch processing for phone appends and to obtain new contact information is an important component of a successful operation. Qualifying the debtor before entering into settlement or repayment terms is a must. This ensures that money isn’t being “left on the table.” Believe in the power of the payer. An established payer base to supplement new money or month-one recoveries plays a very important role. Finally, consistent monitoring and coaching of your staff is critical. Complacency can be devastating, so side-by-side evaluations performed by managers/supervisors as well as a robust internal collector scorecard that helps shed light on those underperforming members of a team [is a must].
What piece of advice would you offer to help an agency get started in credit card collections?
Getting the opportunity or securing your first credit card client may be the easy part. Evaluating your staff to determine who would be a good fit to be allocated to service the credit card client is an integral piece of the puzzle. A good credit card collection team doesn’t necessarily need to be a team full of rock stars similar to what you may do on a mortgage deficiency or student loan client. You have to make sure those collectors you choose can work in a high volume paced environment. Getting through the inventory consistently with good attempts/touches is key.
Are there any games or morale boosting practices you use to keep collectors happy and productive?
Daily, weekly and monthly contests help keep morale high. We always try to do something to help close out the month. We’ve brought in catered lunches, hand out Philly style soft pretzels and lately we’ve had a local masseuse come in to give collectors a 10-minute back massage. As you can possibly imagine, the massage seems to be everyone’s favorite!
Is SIMM Associates involved in the community? If so, how?
SIMM is very involved in our local community. We sponsor a local youth baseball team, participate in Toys for Tots every Christmas, donate to a local chapter of Boys and Girls Club, participate in the Cancer Relay for life since 1995 raising more than $250,000 to date. We’re also a sponsor for a scholarship fund for a local community college that has raised $1.2 million to date.
What do you enjoy doing in your free time?
I love to travel and I'm a fantastic cook. I've had the opportunity and privilege to coach youth baseball and football for the last 10 years. I've recently hung up my whistle but I do still on occasion make it out the fields to see how the programs are doing.