Matt Angell Chief Operating Officer

DEBT COLLECTION OR

24 June 2014

HARDSHIP MANAGEMENT?

Collections & Hardship Programs in Utilities, Banks & Telecommunications

WORKING WITH YOU

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

The power of a paradigm

WORKING WITH YOU

Credit Corp Group Limited is Australia’s largest debt collection company

˃  S&P/ASX 200 debt purchasing and consumer finance company

˃  >900 collection staff

˃  Average investment of $135m per year in purchasing distressed consumer accounts

˃  745,00 overdue consumer debts, totalling ~$4.6bn in outstanding balances

˃  > 1 million potential customer contacts per month

˃  Purchases bank, finance, telecommunication, utility and debt agreement portfolios

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

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The Credit Corp – Kildonan journey 4 years of collaboration on hardship and collections

Listening, observation & assessment

1

2 Embedding an improved collection culture

Comprehensive training & external engagement 3

4 Redefining performance & ongoing training

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

WORKING WITH YOU

My department works to:

>  Understand that anyone can experience unexpected financial problems

>  Engage with our customers in a manner which encourages continued contact, honest representation of issues and intentionally counteracts potential roadblocks including embarrassment, avoidance, etc.

>  Agree a tailored solution which works within the constraints of a customer’s financial circumstances

>  Maintain the integrity of the corporate objective of minimising financial loss

>  Collaborate effectively with financial counsellors and other consumer representatives

>  Achieve on target customer satisfaction feedback

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

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Debt collection departments and companies exist somewhere on a continuum in their capacity to successfully cope with consumer hardship

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

Then Now Both

-  Irresponsible, deceptive, borderline criminal

-  In difficulty due to changed circumstances

The customer

The outcome

Customer experience

Financial counsellors

The conversations -  Respectful, active and responding

-  A flexible tailored strategy which suits the situation

-  Willing to continue to engage

-  Useful allies who we can learn from

-  Overly assertive, little room for the customer to present their situation

-  Payment or settlement in full or a lawsuit

-  Sense of threat and dread – avoid future calls!

-  Bleeding heart enemies

Net recoveries provide

sustainable return

WORKING WITH YOU

Responding to the shift

>  360 degree review of progress inclusive of feedback from staff, regulators, EDR schemes, FCs, legal services and consumers – in short – build an honest picture about present performance

>  Develop policies, procedures and scripts which address regulation but more importantly the realities of engaging with consumers in hardship

>  Introduce an ongoing training regime which develops improved awareness of those issues utilising external experts

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

WORKING WITH YOU

Responding to the shift - continued

>  Challenge historic collection incentive models and align bonus systems with desired behaviour

>  Ensure (via preventative and detective controls) compliance with policies and act against breaches

>  Rinse and repeat

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

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The results – revenue from flexible repayment arrangements

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

We have observed a >50% increase in revenue from this group of customers, who now comprise >70% of our monthly collection receipts. This is an industry leading statistic.

$66,000

$71,000

$76,000

$81,000

$86,000

$91,000

$96,000

$101,000

Dec-11 Jul-12 Jan-13 Jul-13

Ledger Collections - Payers Base

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The results: Australian CRM productivity ($/hr)

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

$210  

$220  

$230  

$240  

$250  

$260  

$270  

$280  

$290  

FY2009   FY2010   FY2011   FY2012   FY2013   FY2014  (YTD)  

This has driven a healthy (>25%) increase in collector productivity

WORKING WITH YOU

Matt Angell Chief Operations Offices

Debt  collec)on  or  hardship  management?  |  June  2014  |    CREDIT  CORP  GROUP  

Matt Angell Chief Operating Officer

QUESTIONS? Collections & Hardship Programs in Utilities, Banks & Telecommunications