A customer-centric collections strategy that works

The latest TransUnion Debt Collection Industry Annual Report reveals that 27% of consumers say they’re concerned about their ability to pay current bills and loans. This signals not just widespread, but rising financial distress. What’s often overlooked is that most people want to repay their debts. Especially in times of hardship, consumers need fair, flexible repayment options that align with their reality.

Transitioning to a modern collections strategy does more than protect the bottom line. It’s an opportunity to strengthen relationships, build trust and support long-term financial health—for clients and creditors.

What human-centric collections really looks like

When most people think about debt collection, “compassion” isn’t the first word that comes to mind. But that’s exactly what’s needed in today’s environment. Humanizing collections isn’t just about new tools and technology—it’s about blending technology with compassion and empathy, and recognizing that each customer’s situation is different.

At its core, a human-centric collections strategy should balance two things: their obligation to pay and the customer’s ability to pay. Done well, this approach doesn’t just protect recovery rates—it builds trust and strengthens long-term relationships.

So what does human-centric collections look like in practice? Here are six guiding principles that bring empathy into your collections strategy:

Engage early and proactively

Collections shouldn’t begin with a missed payment. By embedding intelligence into their systems, organizations can leverage available data to pick up on early warning signs—like increased credit usage or declining credit scores—that may indicate financial distress.

By detecting these patterns early, businesses can trigger proactive outreach, including hardship programs or flexible payment terms to support customers in need. Instead of waiting until a customer falls behind, companies can step in when help matters most.

Personalize every interaction

No two customers are alike, and repayment shouldn’t be either. Personalized solutions—like tailored repayment plans, deferrals and short- or long-term relief—show customers that they are seen and understood.

Artificial intelligence makes personalization even more powerful. It can adapt outreach tone, timing and channel based on individual behavior. Some organizations are even using adaptive hardship interviews, where the system dynamically adjusts its questions based on the customer’s hardship type (e.g., job loss, medical issue).

Embed intelligence into every interaction

Artificial intelligence is no longer a “nice to have”—it’s foundational to the backbone of modern collections. Intelligent collections systems enable:

• Earlier detection of financial distress
• Predictive models for higher contact success rates
• Adaptive tone, cadence and messaging
• Real-time assistance for both customers and collectors

Design seamless, digital-first experiences

Today’s customers expect fast, low-friction solutions. Digital-first collections strategies empower them to manage payments and hardship requests on their terms, often without speaking to a live agent.

The trend is clear: the majority of debt collection companies now offer online self-service portals, and 25% collect more than 40% of payments online (TransUnion report). The key is ensuring seamless channel-switching—customers should be able to start in one channel, switch to another, and escalate to a live agent, without repeating themselves. And if they abandon a digital interaction, real-time alerts can ensure a smooth handoff to a live agent.

Bake compliance into the platform

Empathy and compliance go hand-in-hand. Today’s collections platforms support evolving regulations like the Consumer Financial Protection Bureau (CFSB)’s Debt Collection Rule by:

• Respecting contact frequency limits
• Verifying right party contact
• Maintaining audit trails for every interaction

With embedded AI and ML woven into compliance processes, businesses can stay within the rules while still maximizing successful customer contact.

Offer always-on support

For today’s customers, 24/7 availability is a baseline expectation. Virtual agents are making this possible, supporting customers with payment arrangements, answering questions and enrolling in hardship programs—anytime, on any channel and in multiple languages.

Empowering customers to take control of their own collections experience frees up capacity for live agents to handle complex cases, reducing costs while improving outcomes.

The ROI of empathy

Human-centric collections isn’t just good ethics—it’s good business. Organizations that put empathy at the core of their collections strategies experience:

• Higher repayment and engagement rates
• Lower operational and compliance costs
• Stronger long-term client relationships
• Enhanced brand trust and loyalty

The path forward: technology + humanity

Collections is no longer just a back-office function—it’s a defining part of the customer experience. By blending advanced technology with a human touch, organizations can create collections strategies that deliver measurable results while supporting financial well-being.

CGI Credit Studio for collections helps organizations embed empathy into every interaction—leveraging AI, data and intelligent automation to personalize the customer journey and deliver measurable value.