The collections process involves various degrees of iterations to collect the due payments. The process typically starts off with telephonic dunning to ensure that the payments are made before they become overdue. Telephonic dunning helps in making the customer feel more confident and thus ensures cooperation without harming the customer relationship. An ideal customer dunning helps to streamline the exchanges and quickly resolve disputes and collect unpaid debts.
At HighRadius, we guide our customers to establish proactive customer dunning with eInvoicing and Automated Collections Solutions. It provides an In-App Native-VOIP calling function along with call logs, notes, collaboration history, automated correspondence delivery, and other features to ensure a smooth accounts receivables process.
Customer Dunning Practices and Their Shortcomings
- The traditional customer dunning process that is currently employed by many mid-sized businesses, is hindering the AR process in several ways. As per PYMNTS, close to 20% of the mid-sized businesses are facing issues due to their current AR collections management system, and are looking for an improvement to collect receivables on time.
Let’s take a look at the challenges of the current telephonic dunning process
A single phone reminder can cost anywhere between $12 to $18. At this rate, the overall operational cost to make dunning calls to all the overdue accounts can get highly expensive.
Misinterpretation of Important Information
The details exchanged during the conversation can often get misinterpreted or lost if not noted properly. It is necessary to retain that information post the call to take further action. In situations such as disputes, deductions, and payment overdue, it is important to ensure that all the related information is documented properly in one place.
Absence of Centralized Repositories
A successful telephonic dunning requires a qualified database that enables you to reach the right person. Due to the absence of a centralized data repository, internal collaboration can get complicated. During the accounts receivable process, various analysts handle the dunning calls, which means that there will be several documents of information exchange present across different departments. Data aggregation in this regard gets more complicated and time-consuming.
HighRadius: Catalyst for Efficient DunningCollections play a crucial role in the success of a business. Hence it is very essential to make sure that the payments are received before they become overdue.
Collection Analysts are often required to contact customers for payment collections. Periodic customer dunning is necessary to ensure that the customer and the business are on the same page. The most effective mode of communication to ensure the commitment from the customer is voice calling.
Let’s take a look at HighRadius In-app calling feature that allows you to call a customer directly from the application thus optimizing the whole collections process.
Native VoIP(Voice over Internet Protocol)
A powerful alternative for analog phone calls is VoIP technology. VoIP enables analysts to make calls using an internet connection instead of a telephonic line. With the help of this technology, businesses can save a high portion of their operational expenses that was earlier spent on dunning calls through regular phone lines. HighRadius’s In-App Calling function is Native VoIP enabled, which allows the analysts to make a call directly via the app with CTI(Computer Telephony Integration).
Make Information Retention Simpler
Having standardized access to customer data can make the AR collection process easier. You can easily view collaboration history, analysts’ notes during calls, call logs, call recordings, and previous conversations details on the HighRadius platform while having a conversation with your client.
Check this blog on how automation helps in improving collections and dunning.
Centralized Data Access
Having a single repository for all the required collections documents can save the time and efforts of the analysts. This single digital repository can hold all the account-related information such as, past conversation details, all the associated documents, bills, invoices, correspondences, call logs, analysts’ notes, and more that can help in taking further actions on that account.
Learn more about centralized repositories with this blog on why create a centralized repository of all accounts receivable data?
What Should be Your Next Steps?
Establishing a proper AR management system in place is of utmost importance for many mid-sized businesses. The traditional dunning approach however involved high operational costs and data mismanagement, which resulted in bad debts. By upgrading the traditional practices with the help of technology, companies can garner more receivables at cheaper expenditure.
Now that we have learned about the need to advance the current dunning process by introducing technology, let’s take a look at how you can incorporate automation into the system?
- Evaluate your current AR and ROI for your future investments
- Discuss different pain points with your team members
- Make a list of features that you need to have
Want to know more about how you can improve your AR collections management to get better results? Check this blog on how to use data-driven strategies to mitigate AR Collections Recovery.