How Lenders Can Benefit from Outsourcing the Debt Management Plan Process
Updated: Sep 21
At Peregrin, we’ve been keeping a close eye on the default situation set to hit in October. You can read our latest breakdown here for more information on that. As these defaults start to roll in, you want to effectively support your cardmembers and take care of your employees without breaking the bank (pun intended).
Millions of people turn to credit counseling annually, and hundreds of thousands enroll in debt management plans (DMPs) to help them manage their debt and finances. For lenders, the DMP process can be time-consuming and expensive, especially when handling situations like deferred payment programs and figuring out how to continue working through a pandemic. This is where DMP outsourcing comes in.
Track and Approve DMPs Effortlessly
Cardmembers choose from a wide variety of credit counseling agencies (CCAs) to help them consolidate and pay off their debt. So, it can be a challenge for lenders to take the time to document which accounts belong to which agencies and to keep up with all the changes that happen on the account.
As a lender, you may have experienced times when you acquired an account that lacked details about the debt. You may have even dealt with payments continuing to go to divesting banks, resulting in extra costs, payment delays, and poor customer experience.
Outsourcing DMP management eliminates these issues. Peregrin’s platform keeps all of this information organized, so with a quick account lookup, lenders are able to see:
Which agency the account belongs to
The remaining balance on the account
Key events in the DMP history, including when it was transferred previously
Additionally, it gives CCAs the ability to access their own clients’ information, reducing the number of calls that lenders receive. This streamlines the process, saves expense, and improves the customer experience.
Improve Privacy and Compliance
Communication has notoriously been challenging in the open DMP and CCA space. Peregrin introduced additional, secure website functionality enabling creditors and agencies to stay up to date with the latest information affecting creditors, CCAs, or clients immediately. That helps keep everyone informed of compliance and process changes to help them make better and faster decisions, and to modify their processes quickly.
This gives employees the freedom to focus on other projects that can help save money and serve current cardmembers better. It can also reduce the chances of legal exposure by keeping lenders in compliance and ensuring that private cardmember information is only released to CCAs engaged by the cardmember.
Both lenders and cardmembers value their privacy compliance. Outsourcing the DMP process to a third party like Peregrin ensures that the only PII exchanged between parties is what is necessary, it also goes only where it is allowed to go, and all access not only secure but also tracked.
Data Safety and Accessibility
If the importance of being able to access critical information from anywhere wasn’t evident before COVID-19, the pandemic has definitely brought it to light. Thousands of lender support staff are now working remotely for health and safety purposes.
Outsourcing your DMP process means that as long as you have access to the internet, you can manage DMP accounts. Peregrin’s platform is accessible via any internet browser anywhere in the world. It doesn’t require a sophisticated system or intricate tech knowledge, so it is easy to train on.
You can also rest easy knowing that the information is both safe and secure. Since the records are electronic and routinely backed up, they are not susceptible to damage as a result of natural disasters or other accidents.
Ultimately, what outsourcing your DMP process does is save you time and money, protecting your bottom line, and improving your customer service. Throughout the COVID-19 pandemic, we’ve helped free up lenders’ time to take care of their employees and cardmembers and we’re eager to continue doing our part in this unprecedented time.
If you have questions or would like to know more about improving your DMP processes, give us a call at 1-800-231-2493 or contact us online.