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Saba Shaukat

One of the things that the pandemic has surfaced is increasing inequality.

The impact of Covid-19 continues to take its toll not only on people’s physical and mental health but also on their financial stability: redundancies, business closures and reduced earnings  have meant that nearly 51% of people have been forced into debt since March 20201 while the Citizens Advice Bureau reports that 3.4 million people have fallen behind with their mobile phone and broadband bills. More and more people in the UK are highly vulnerable to further financial shocks. With increasing indebtedness this is not about overspending but about not being able to afford the basics.

The pandemic has also changed how we live, with people more dependent than ever on home phones, mobile or broadband services. Back in March the UK’s major telecoms companies agreed a set of important commitments to support and protect vulnerable customers, placing collections right at the centre of their response to ensure customers stay connected and are given some relief in their payment terms: examples include removing data allowance caps on all current fixed broadband services and allowing payment holidays. But whilst payment holidays can relieve an immediate pressure, there is a risk that it stores up a problem.  How does telecoms  effectively manage people off these payment holidays? How do they continuously identify who’s really in financial distress and needs immediate support?

Despite telecoms adopting these supporting measures, many people are still worried about their ability to cope financially, and this has turned the spotlight onto customer experience and the way that organisations are treating their customers – especially those who are vulnerable. The telecoms industry long experienced a decline in customer satisfaction, rating lower than the UK average for most metrics, including trust, openness and transparency2.

We commissioned independent market research, to gain a deeper understanding of the issues facing people who currently have, or expect to have, unmanageable debt and how they want to be treated by their creditors during the collections process.

The results clearly demonstrate that – like others - the telecoms industry needs to rethink its collections strategies to make the debt collection process fair and supportive. Those willing to do this will benefit from customers’ loyalty in the future. So what are the actions that companies can take?

Educate your customers who are in arrears

58% of those currently facing unmanageable debt said that this was the first time that making repayments had been an issue for them3. This means they’re often unaware of the options available to them, so it is essential contact centre staff take the time to explain the choices available and work through to ensure they choose a repayment plan that is affordable and realistic. Information should  be easily accessible through website and chat too.

Train your workforce to identify vulnerable customers and engage with them early

There’s no doubt that financial distress, heightened by Covid-19, is affecting people’s mental health. Older people in particular, feel embarrassed about their debts and abandoned by the companies that they owe money to; they even feel scared to talk to them, which makes their financial situation even worse. This may be driven by the traditional perception that older people are living within their means and using credit reluctantly but many of our research participants – of all age groups – have admitted avoiding communication and waiting for the company to contact them first.

Telecommunication companies can take steps to reassure their customers that they want to help them. For example, by extending the collections journey to include pre-emptive involvement and increasing end-to-end monitoring and automation, companies could engage with customers as soon as they’re deemed to be at risk of getting into debt to discuss the best way to tackle the situation. And some companies  soon  realised that more and more people are struggling to serve their debt due to widespread furlough and loss of income. Talktalk, for example, said that now there are new processes in place for those who haven’t got jobs, or who work reduced hours4.

Increase flexibility around how customers want to be contacted

Companies must accommodate customers’ needs in their collection process to take into account that flexibility and fairness are seen as the most important factors by those in debt. For example, some of the heads of collections who we spoke to during the research said that the traditional fixed payment date, where customers pay their bill on the same day every month, is changing to accommodate those who have a flexible income. Could this approach be adopted by other companies to allow for the ever-changing nature of employment contracts?

This flexible approach applies in contacting customers too. Businesses can’t assume that all customers want to be contacted in the same way during the collections process, as everyone’s circumstance is different. Despite admitting that they were ashamed to speak to creditors, 67% of our research participants said they preferred to talk to a customer service agent rather than self-serve on a website. At times of distress provide your customers with a responsive and seamless experience across channels they choose to use whether mobile devices, social networks, online or on the phone.

Personalise the user-experience based on the power of your data

Telecoms operators can also leverage data to their advantage to make more informed decisions such as: what’s the most effective communication channel to reach the defaulting customers? When should they contact them? How often?

Data analytics can help uncover which customers are most likely to pay on their own and those who may need a little more help, allowing companies to adjust their strategy accordingly. By taking into account the customers’ preferences, there is a greater chance to increase customer satisfaction and improve retention.

A blend of human-centred and automated interactions can centre collections around empathy, proactivity and data analysis. By combining empathetic conversations, tailored support and data-driven outreach, companies can create a personalised collections journey that can help to identify at-risk moments, prevent debt, and increase long-term loyalty.

In conclusion, telecoms companies must do more to help vulnerable customers. People have high expectations that contact should be easy, compassionate and, above all, tailored to their situation. Many feel that they are treated like a number and not like a human being5. So, companies must be flexible and fair when collecting debt and communicating with customers.

Treating customers fairly, at a time when they are most in need, can make them more loyal, which will help businesses to grow their revenue in the future. By demonstrating the leadership of kindness, big brands like telecoms operators will reap dividends through increased customer advocacy and loyalty once we emerge on the other side of the pandemic.

Written by


Saba Shaukat

Consulting lead - Telecoms, Media and Entertainment

Saba has spent over 20 years in technology and telecoms activating big bold visions to create better outcomes for Enterprise and Government. She helps companies navigate uncertainties towards a digitally enabled future by unleashing the power of creativity and transformative technology to pivot towards new opportunities and growth with pace and agility.

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