The decline in landlines—only 40% of households have one, down from more than 90% in 2004, according to the Centers for Disease Control—and the rise of caller ID have had a big impact on collectors who rely on the phone to reach delinquent account holders.

“Consumer behaviors with respect to technology have greatly impacted the way we collect,” says Abby Poragin, senior product evangelist for Temenos USA.

“People are used to instant service, online applications, and being able to access everything from a smartphone,” she says. “So they want that when they fall behind on a loan, too.”

Dan Picard, vice president of consumer lending at $1.4 billion asset Hanscom Federal Credit Union in Littleton, Mass., agrees. “Everybody has a mobile device now. And with that comes the widespread use of caller ID. It makes it harder to reach people in general.”

Just as consumers use technology to avoid being located, collectors use big data find them. Picard says credit unions use aggregated data to their advantage, triangulating information purchased from retailers, restaurant chains, and more, to uncover ways to contact people.

New technology can also make the collections process friendlier and more effective, says Larry Edgar-Smith, senior vice president of product evangelism for Temenos USA.

“As we have more digital natives in the population, we see them looking to their lending organizations for more communication and more tools they can access from their smartphones,” he says. “One of our clients sends reminder texts five to 15 days before a payment is due. This helps prevent members from being late on the payments. Members actually ask for reminders like this.”

Lending & collections resources

That approach, rooted in relationships, also means credit union collections efforts are informed by a personal understanding of changes in the member’s financial health.

Credit unions typically see the bigger picture when addressing delinquencies, Edgar-Smith says. “We can look holistically at members and realize, for example, that while they might be in collections now, part of the reason is they’ve incurred medical school loans. So the remediation strategies might differ.”