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Consumer Credit News

Mobile users leaving a trail of debt

Unpaid bills and defaulting customers are globally costing mobile

operators around $2 6 billion a year with around 5% of total billings

being written off annually, a survey of operators around the world

has revealed. This is one of the main findings of research Talgen tra

has conducted in conjunction with telecom analysts, Analysys, into

customer revenue management and debt collection at mobile

operators around the world.

The report,

Customer Revenue Management and D ebt Coliection:

a

global survey of telecom ope rators

also showed that operators

would benefit from the development and use of country-specific

databases of defaulting customers. This would enable operators to

identify persistent won't pay defaulters who know that taking legal

action would cost the operators more in legal costs than the amount

due. One of the key reasons identified for the high write-off figures

is that the collection of mo nies due on unpaid bills often falls

between the responsibilities of different departments within an

operator - which indicates that a cohesive revenue management

strategy is not in place. This uncoordinated approa ch is directly

affecting the bottom lines of operators.

A spokesma n for Ana lysys, explaine d: Traditionally the telecom s

industry has tried to recover monies owed by relying on traditional

mail and phone techniques followed by contract cancellation and

disconnection. This approach is becoming untenable. In

deregulated markets and with mobile phones often replacing fixed

lines,

the threat of disconnection is no longer as strong as it wa s. It

is easier than ever before for customers to switch between

providers, leaving a trail of debt in their wake.

Brian Dewis, CEO of Talgen tra, com m ented : It is surprising how

many operators are still using obsolete credit management systems.

It seems that revenue management and collection strategies

invariably play second fiddle to the billing process. However,

operators who implement specialist customer revenue management

and collection systems report significantly improved cash flow,

reduced debt write-off, improved productivity and stronger customer

relations - with RO I typically achieved in less than 12 mon ths.

Call for more consumer credit education

With personal debt problems reaching an all time high,R3 has

called on the government to address the problem through the

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