SMS Texts Soar
Yes, text messaging debtors is a touchy subject for some and definitely not the norm yet, but what is undeniable is the popularity of consumers sending texts to whomever, a trend which only seems to always be on an upswing.
From MarketCharts.com:
Last week, Nancy O'Malley, J.D., vice president of asset recovery at Security Service Federal Credit Union, gave text messaging's appeal a shout out on her credit card collections panel at the Collections & Credit Risk Conference in Las Vegas.
"Without exception, when it comes to landlines, we're seeing a significant decrease in contacts," O'Malley said.
Younger consumers, particularly 25 and under, prefer texting, she explains.
"The fact of the matter is the young generation doesn't have a landline," O'Malley said. "The name of the game is to reach them anyway we can."
Another reason why a delinquent might prefer a text message? It's more of a comfortable channel, as it removes any fear of what a collector might say to a delinquent, she said.
From MarketCharts.com:
More than 740 billion text messages were sent in the US during the first half of 2009, a figure that breaks down to approximately 4.1 billion messages per day, according to findings from a semi-annual industry survey from CTIA-The Wireless Association.
This number is nearly double the number of texts sent during the same period last year, when 385 billion were reported in H108, the wireless-industry association said.
This number is nearly double the number of texts sent during the same period last year, when 385 billion were reported in H108, the wireless-industry association said.
Last week, Nancy O'Malley, J.D., vice president of asset recovery at Security Service Federal Credit Union, gave text messaging's appeal a shout out on her credit card collections panel at the Collections & Credit Risk Conference in Las Vegas.
"Without exception, when it comes to landlines, we're seeing a significant decrease in contacts," O'Malley said.
Younger consumers, particularly 25 and under, prefer texting, she explains.
"The fact of the matter is the young generation doesn't have a landline," O'Malley said. "The name of the game is to reach them anyway we can."
Another reason why a delinquent might prefer a text message? It's more of a comfortable channel, as it removes any fear of what a collector might say to a delinquent, she said.
Tags: collections, mobile, sourcemedia, texting
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Comment by Danny Cantrell on October 27, 2009 at 10:46am
- Our Clients using our Texting Serivces for Collections are seeing a 10 % to 15 % better collections. We consult and council with their legal department to make sure they are doing things the right way. This is slowly but surely becoming the new found way to aproach the customer who owes
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Comment by David Phelps on October 27, 2009 at 11:14am - How do you get around the FDCPA guidelines about disclosure - similar to the issues with using email?
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Comment by Neal Cropper on October 27, 2009 at 1:07pm - I believe and please anyone correct me if I am wrong. While certainly SMS should never be the first communication with a consumer it is alright to use on subsequent communications. So long as the communication states it is from a debt collector. Am I wrong on this one folks?
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Comment by Steve Bressler on October 27, 2009 at 1:19pm - We have reviewed this and the case law (at the current time) is unclear. This will definiteky be a viable communication option in the future.
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Comment by Neal Cropper on October 27, 2009 at 1:24pm
- I should add that the solution used needs to be free to the end user (consumer).
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Comment by Chris Baggett on October 27, 2009 at 1:50pm - The numbers you see represented above can be a bit misleading in that most of those messages being sent are not in the Financial Services arena. Currently, only about 12 million messages per day are being used nationally for all financial services. Our discussions with the FTC have indicated that they they believe that this technology should be allowed, but only if it meets both the TCPA and FDCPA requirements. That means, Free to End User or no charge to the debtor. GoLiveSMS is working with the legal departments of several very large collection agencies, data management companies and organizations such as Fisca, OLA, ACA International to come to a clarified conclusion as to the best practices for SMS usage. We along with will be the legal counsel for most of these organizations and interested parties are meeting with the FCC in January to hopefully put this issue to rest. If anyone would like a copy of our best practices and legal opinions surrounding this issue it can be downloaded free at: http://www.golivesms.com/press-releases/
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Comment by Michelle Dunn on October 28, 2009 at 5:43am -
Some cell phones that accept text messages may be “business” phones or may be provided by a consumers employer, That employer may have the right to view any text messages sent to or received by that company phone. This would violate third party disclosure through the FDCPA. Also, many consumers have phones that multiple family members may use and they could see a message from you that is for their sibling or parent.
Another consideration with text messages is how much space are you going to use to include the mini-miranda or your collection information? It may be difficult to include any legal information along with a debt collection notice on a text message.
You might want to take a look at the Telephone Consumer Protection Act (TCPA) since their requirements may also apply to text messages. The TCPA prohibits any call using any type of automated dialing telephone system to any number assigned through a cellular telephone service. If you are using an automatic dialer, be sure to verify you aren’t breaking any laws.
To avoid getting into trouble there are some steps you can take to protect yourself but not completely since the law is not entirely clear on this issue:
• Obtain consent from the consumer in writing to communicate via email or text
• Clearly state in your emails or text messages that you are a bill collector
• Include your phone number
• Provide opt-out information so a consumer can STOP any emails or text messages
• Use “Free to end user” services so debtors or consumers never incur a charge for your messages.
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