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Deep Dive into CollectionAgency Operations &Technology IssuesResults of Collection Agency BusinessStrategy and Technology Survey

Dave Yohe

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Any content included in this presentation or discussed during this session (“Content”) ispresented for educational and general reference purposes only. ACA International,either directly or indirectly through speakers, independent contractors, employees ormembers of ACA International (collectively referred to as “ACA”) provides the Contentas a courtesy to be used for informational purposes only. The Contents are notintended to serve as legal or other advice. ACA does not represent or warrant that theContent is accurate, complete or current for any specific or particular purpose orapplication.

This information is not intended to be a full and exhaustive explanation of the law inany area, nor should it be used to replace the advice of your own legal counsel. ACAis the sole owner of the Contents and all the associated copyrights. ACA hereby grantsa limited license to the Contents solely in accordance with the copyright policyprovided at www.acainternational.org. By using the Contents in any way, whether ornot authorized, the user assumes all risk and hereby releases ACA from any liabilityassociated with the Content.

The views and opinions of the speakers expressed herein are solely those ofthe presenters and not ACA International.

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Presenter Introductions

• Dave Yohe – VicePresident of Marketing atBillingTree

– Over 6 years in currentrole & frequent ACAspeaker

– 26 years overallexperience in marketing

– Lives in Phoenix, AZ

Agenda

• About BillingTree

• Annual ARM Industry SurveyBackground

• Key Findings from the Report

• Surprises and Observations

• Questions

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About BillingTree

• Founded in 2003, ACA Affiliate Member, In Booth316 as a Gold Sponsor for the conference

• Offer payment services to the ARM Industry– ACH, Credit, Debit, Check 21, HSA & FSA– Process over $2 Billion annually for clients with

complimentary transaction monitoring– Integrated into leading software solutions as well as

proprietary systems– Tier 1 US based Customer Support & Training– PCI-DSS 3.0, SSAE-16, HIPAA

• Supply Payment Solutions to ARM with Payrazr– Gateways, Portals, IVRs, Negotiators, V-Terms, APIs– Partner with best of breed solution providers & build in

house

ANNUAL ARM INDUSTRYSURVEY BACKGROUND

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Survey Background

• 4th annual ARMIndustry Survey

• Conducted inFebruary 2016

• Over 200respondentsanswers compiledin current reportsresults

Agency Seats – 2016

How many agents/seats does your collection agencyemploy?

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Agency Seats – previous years

How many agents/seats does your collection agencyemploy?

2015 Results 2014 Results 2013 Results

How much is collected in anaverage MONTH at your agency?

% of Agencies

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How much is collected in anaverage MONTH at youragency?

$10,000 - $50,0007%

$50,001 - $100,0007%

$100,001 - $300,00024%

[CATEGORY NAME][PERCENTAGE]

$500,001 -$1,000,000

13%

$1,000,001 -$1,500,000

8%

$1,500,001 -$2,000,000

7%

More than$2,000,000

19%

Which software platform is your agency running to manage yourcollections?

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Collections Software - 2015

Which software platform is youragency running to manage yourcollections?

What type of debt does your agencycollect?

% of Agencies

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What type of debt does youragency collect?

2015 Results

KEY FINDINGS FROM THE REPORT

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Please rate the importance of each area below as it relates to youragency’s projected growth plan/profitability in 2016.

2015 Results

Other – Growth Plan

• Compliance

• Sell business

• Staff Development

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Please rate the significance of your concerns related to your agency’scollection operations in 2016.

Top Concerns - 2015Please rate the significance of your concerns related to your agency’s collectionoperations in 2015.

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Typical Agency Scenarios

• Recording calls and capturing thecard info– Capturing the CVV2 Info on the

recording

• Handling payment plans as multipleone time payments– Increases letter costs & compliance

risk

• Avoiding Reg E. requirements byprinting paper drafts– Increased cost, time and risk

• Not confirming if Credit or Debitcard– Possible Reg E and E-sign violations

PASTDUE

How would you rate your company’s compliance risk concerns as theyrelate to the following payment processing and account maintenanceregulations and guidelines?

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What is PCI DSS 3.1?

Payment Card Industry

Data Security Standard

Enacted and enforced by the

Card Brands / Payment Networks

Compliance is mandatory

for all merchants that accept

any payment cards

Compliance Risks

How would you rate your company’s compliance risk concerns as they relate to thefollowing payment processing and account maintenance regulations and guidelines?

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Other Concerns

• Unclear regulations

• Client retention

Other Compliance Risks

• All are very important and high risk

• TCPA

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Do you foresee a major legal ruling orcompliance challenge impacting thecollection industry in 2016?

% of Agencies

Do you foresee a major legal ruling orcompliance challenge impacting thecollection industry in 2015?

46.0%

47.0%

48.0%

49.0%

50.0%

51.0%

52.0%

53.0%

Yes No

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Technology Needs - 2016What is the one technology you wish were available to your organization that is currentlynot available?

Survey Responses:• Automated dialing that meets TCPA requirements• IVR• Ability to identify reassigned and ported wireless numbers• Speech recognition• TCPA consent management• Better reporting ability, especially with compliance• Phone ownership solution• A better way to realistically score medical accounts• Automated cell phone dialing• ACH without NSF-% restrictions• Voice analytics• Real-time online account management

Technology Needs - 2015What is the one technology you wish were available to your organization that is currentlynot available?

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Rank the most significant concerns or challengesfacing the collection industry in 2016 in order of priorityfrom 1 to 8.

*Other: TCPA lawsuits

Rank the most significant concerns or challengesfacing the collection industry in 2015 in order of priorityfrom 1 to 8.

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To what degree do the following payment collection practicespose a potential compliance risk and/or lead to customercomplaints for your organization?

Does your agency charge a convenience fee to consumers?

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Convenience Fee Adoption

Does your agency charge a convenience fee to consumers?

2015 Results 2014 Results

Please rate the importance of each aspect of your paymentprocessing experience with a payment processor.

*Other: Cost, Reg E Compliance Built-in, Omni-Channel Presence

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Payment Processing PrioritiesPlease rate the importance of each aspect of your payment processing experience with apayment processor.

Other Payment ProcessingPriorities• Accountability

• REG E Compliance

• To be able to spot fraudulent attemptsto replace processor

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SURPRISING FINDS FROMTHIS YEAR’S ARM SURVEY

What level of reporting detail do you typically rely on from your paymentgateway to manage payment operations?

Data Reliance

88%TakeawayAgencies count on their techpartners for critical data

What level of reporting detail do you typically rely onfrom your payment gateway to manage paymentoperations?

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Level of Reporting - 2015

Data Reliance

84%TakeawayAgencies count on their techpartners for critical data

What level of reporting detail do you typically rely onfrom your payment gateway to manage paymentoperations?

Which types of payments does your agency currently accept?(Please select all that apply)

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Forms of Payment Accepted - 2015Which types of payments does your agency currently accept?

Percent of payments by type

What percentage (%) of your collections do you receiveusing these type of payments?

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Percent of payments by type - 2015What percentage (%) of your collections do you receiveusing these type of payments?

Planned Technology Utilization in 2016, All Seat Groups

% of Agencies

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Technology Utilization - 2015Technology Utilization, All Seat Groups

To what degree do the following payment methods inuse by your organization today pose a compliancerisk?

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Payment Methods – Compliance Risk - 2015

To what degree do the following payment methods in use by your organizationtoday pose a compliance risk?

Do you offer your clients the ability to pay with anHSA/FSA account?

68% TY vs 79% LY

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HSA/FSA Payment Adoption - 2015

Do you offer your clients the ability to pay with an HSA/FSAaccount?

What technology or new offering do you foreseecoming online in 2016 that would make a significantimpact on the collection industry?

Survey Responses:• Compliance management tools• Text message debt negotiation• Email marketing• At home employment• Data management• Compliance umbrella system• Live speech analytics• Alternative channel strategies• Seamless CRM and cloud dialer• Tax bill monitoring• Aspect dialer• CirraFi – a new technology that makes it easier for patients to

understand what they owe – puts it all in one screen so theycan make multiple healthcare payments in one place so thatpatients have a secure and convenient place to make a fairsettlement for outstanding medical bills

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What technology or new offering do you foreseecoming online in 2016 that would make a significantimpact on the collection industry? Cont’d…

Survey Responses:• Multi-channel dialer solutions• Real time solutions• Virtual negotiation• Affordable analytics• Better cell phone scrub services• Cell phone directory assistance database• Manual dialing/Call assist• TCPA database for correct numbers• New dialer technology to deal with TCPA issues• Cloud-based, collection compliance software• Dialers compatible with the new FTC declaratory ruling

QUESTIONS & OPENDISCUSSION

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