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Caring Consumer Collections Policies Gain Traction

Economic woes tied to pandemic, brutal weather events shift thinking to model advocated two decades ago

April 6, 2021 By admin Leave a Comment

Views: 34

[Editor’s note: This is a guest post from Shaun O’Neill, President of Concord Servicing Corporation. Founded in 1988, Concord is a world-class financial technology company, delivering innovative, flexible, and scalable portfolio servicing solutions to meet the demands of loan originators and capital providers (and their customers) in multiple asset classes.]

A recommendation that collections and customer service “should be two sides of the same coin” is currently gaining momentum in the pandemic era. But this approach was advocated fully two decades ago by none other than LendIt’s own Peter Renton.

In a previous life he owned a printing company that sold products to credit departments and he had long advocated the need for consummate customer service. His key recommendations tied to bill-collection policies appeared in a January 2001 article in the prestigious Editor & Publisher magazine.

In part, his bylined article states: “In this dark morass actually lies a wonderful opportunity to turn debt collection into a customer-relationship-building program…this opens up the potential to generate some unexpected goodwill.”

The article continues: “…there’s a big payoff, literally and figuratively, for debt collectors who view themselves as customer-service representatives…Instead of a typical collection call, take the initiative to be empathic.”

To drive home the point about win-win, Renton suggests a discussion that asks the question: “What can we come up with together that will satisfy both of our cash-flow concerns? While you have the customer’s attention, attempt to extract a commitment from the customer to a mutually agreeable future payment framework.”

In a nutshell, this is how debt collection strategies are evolving now. Renton’s advice 20 years ago is spot on, and more important than ever.

A combination of economic woes triggered by the pandemic, and exacerbated by weather-related catastrophes, makes kinder, gentler, more understanding collection policies good for portfolio performance. They’re likely to generate more revenue than a hardline approach, plus there’s the benefit of building longevity and loyalty with customers who like, trust and respect their “bill collectors” instead of abhorring them.

[Read more…]

Filed Under: Fintech Tagged With: collections, credit, Loan Servicing

Views: 34

Vervent and Finitive Working Together to Promote Fintech Best Practices

The leading fintech companies are creating a new kind of partnership focused on education and inclusion in underserved markets

June 2, 2020 By Peter Renton Leave a Comment

Views: 233

Fintech industry pioneers David Johnson, CEO of Vervent (formerly First Associates) and Jon Barlow, CEO of Finitive, have worked on lending deals together for many years. Both of their companies have been instrumental in educating lending platforms on industry best practices.

Vervent has become the industry leader in loan servicing for fintech lenders as well as in a number of lending verticals. Finitive is a fintech platform bringing together institutional investors and non-bank lending platforms (listen to my podcast last month with Jon Barlow). Together, they are quite complementary, with Finitive working on setting up and closing deals while Vervent helps on the back office making sure the loan servicing is set up and running optimally.

Today, they announced they are formalizing their partnership to “further promote collaboration and inclusion within the Fintech industry”. What does this mean exactly? In an email sent by David Johnson yesterday they provide some clues:

There is so much knowledge in this industry. We want to share and use our collective resources and experience to open up alternative lending to new players and opportunities that will enhance our industry. With the combined power of Vervent’s advanced portfolio servicing and Finitive’s network and data expertise in private credit transactions, we can do that.

I reached out to Vervent for more color on exactly what they have planned. What they are going to be doing is focusing on those areas of fintech that are less developed and help industry participants with best practices. The first niche they will be focusing on is solar lending. They will be creating an educational white paper and publishing some case studies. From there they are going to move to the Canadian market and then on to Latin America.

Obviously, the ultimate goal here is for both companies to gain new clients but they also recognize that the more these markets develop the right way the more they will flourish. This will lead to more opportunities for both companies.

My Take

This is a great example of fintech companies working together in a new kind of partnership. These companies are experienced in working on complex deals and have each developed a great deal of domain expertise. They are obviously complementary, as every lender needs investor capital as well as servicing, and they have a lot to gain in bringing their expertise into  less developed markets. I am looking forward to seeing how this partnership develops.

Filed Under: Fintech Tagged With: debt financing, Finitive, First Associates, Loan Servicing, Vervent

Views: 233

Keys to a Successful Securitization for Marketplace Lending Platforms

As marketplace lending securitizations rise, competitive advantage lies with companies able to move efficiently through the process

January 8, 2016 By Ryan Lichtenwald 1 Comment

Views: 88

First Associates White Paper

[Editor’s note: This is a guest post by David Johnson. David is the Chief Executive Officer at First Associates, the fastest growing loan servicer in the country with a $7 billion dollar portfolio under management for various asset classes including P2P and P2B loans. As CEO, Johnson increased revenues at First Associates by 20x in just three years.]

Marketplace lending reliance on non-deposit funds for lending capital is driving increasing securitization volume. Marketplace lenders aiming to rise to the top of the pack would be well-advised to start planning for securitization now, if they haven’t already.

For those both contemplating and completing securitization, PeerIQ Research has initiated a series of reports called the Marketplace Lending Securitization Tracker, starting with third quarter 2015. The reports track various elements of securitized marketplace lending progress and performance.

According to the inaugural report, “As the sector continues to scale—with a projected $50B in total US originations by end of 2015—origination platforms, loan purchasers, and other market participants are increasingly looking to the [Asset-Backed Securities] ABS markets to meet their funding needs…Securitization is an essential link in the funding chain connecting originators to institutional investors in the capital markets. A transparent, simple, high-quality securitization market with active repeat issuance will connect marketplace lenders to long-term, low-cost, and diverse capital base, thereby reducing the funding risk through all credit environments.” [Read more…]

Filed Under: Guest Post Tagged With: First Associates, Loan Servicing, securitization

Views: 88

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ABOUT LENDIT FINTECH NEWS

LendIt Fintech News, Powered by Lend Academy, has been bringing you all the news and information about fintech and online lending since 2010 when it was founded by Peter Renton. We not only have the industry’s most active news site, but also the largest investor forum and the first and most popular podcast.

We are a team of fintech enthusiasts who have been covering the industry for many years. With a deep knowledge of online lending, digital banking, blockchain, artificial intelligence and more our team covers the daily news and writes in-depth editorials.

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