Loan arrears are a problem for financing institutions. Arrears that are allowed to get out of control become difficult and expensive to recover.
Collections departments need efficient and scalable ways to remind customers about upcoming payments and to tell them when one has been missed. Early customer contact often helps prevent problems from escalating. Arrears can then be resolved without resorting to formal letters, debt collection, or repossession.
Voice calls are a gentler way to inform customers when they have missed a payment and to start a dialogue. It’s also much harder to ignore a voice call than an email or SMS.
However, collections departments are overloaded and simply don’t have the resources to make individual calls. So the voice channel is often reserved for high priority or high risk accounts.