STRATEGIES FOR MANAGING COLLECTIONS IN A PANDEMIC

Pandemic contingency planning has been part of the Harvest Strategy Group Business Continuity Plan for many years.  We could only begin to imagine the complex and far reaching implications that a global pandemic would have on economies, cities and families.  The shift from “business as usual” on March 1st to a “full pandemic” response on March 31st was dramatic.  How have we managed through the crisis?  Our team has learned a great deal and want to share a number of our insights.  

1. Communication is Critical when Operating in a Crisis

An easy part of our pandemic response plan was converting all of our staff to a work from home mode.  We announced on March 12 that all Harvest employees would work-from-home starting Monday March 16. Implemented for the first time in a live environment in our company’s history, our execution was flawless.  Managing the fallout over the coming months would prove to be much more challenging and diverse.  Changes across the nation were occurring on a daily basis as the national and state-level responses to the pandemic began.  When changes were required, we confirmed with our vendors and service providers that they were aware of the changes and had adapted their policies and procedures.  We introduced the necessary monitoring and compliance program adjustments accordingly.  Our team communicated all procedural changes to all clients, along with notices of court issues, stay-at-home and shelter-in-place orders, and other pertinent information as quickly as it was known to ensure they were informed and aware. This was in the form of a daily newsletter (sample copy attached).  Likewise, clients had specific concerns and process changes to communicate to us.  Through an ongoing dialog our leadership team was able to rapidly develop custom client-level pandemic response tactical plans to meet our clients’ interests and objectives.   The strength and resolve of our client partnerships were critical at this moment. 

2. A National Disaster Means Extra Care for Consumers

A consistent message from our clients was to exercise compassion when consumers request help.  As it is core to our company, and is ever more important today, we are focusing even more on a consumer-centric, compassionate approach to collections.  For example, we need to be flexible when consumers ask to reschedule payments.  We were able to temporarily suspend payment or reduce monthly payment amounts to help bridge consumer’s during this temporary time of difficulty.  We have communicated this to all our collection partners as the expected way to do business going forward until this pandemic situation is behind us.  We manage these changes through auditing to make sure this approach of heightened sensitivity is being implemented appropriately and consistently.  One client recently expressed concern about the potential downfall of adhering to a liberal policy of accepting all customer requests.  This client acknowledged the need to be flexible, but their concern was:  “What about the consumer who is using COVID situation to their personal benefit?”  Our advice and feedback to the client was our belief that now is not the time to make any critical evaluation of a consumer’s request to reschedule, postpone or cancel existing payment plans.  Now is the time to be trusting and compassionate toward consumer hardships.  We want our business partners and vendors to ask the logical questions and document those answers: Who in your family has been impacted?   When do you anticipate that your situation will stabilize and then return to normal?  Is there anything else we can do to assist you at this time?  When can we check back for a status update?   It has always been our policy to implement similar strategies during local disasters like hurricanes and tornados.  This is the same approach, expanded on a national scale. 

3. Court Activity Will Resume on a Different Timeline by State

At Harvest Strategy Group we manage both collection and litigation recovery programs.  The management of litigation recovery activity has proven to be more complex because each state has responded to the pandemic differently. At the time of this writing, five states have passed laws that prohibit the filing of lawsuits during the pandemic crisis while other states have implemented mandatory court closures and delays or prohibited certain other actions like garnishments.   Most states have not passed laws but have reduced court schedules or postponed case handling.  Below is a summary of issues by state which demonstrates the diversity of issues.  We highly anticipate that any return to normal will take time and will be on a state-by-state basis as states announce their updated procedures.  As temporary stays are lifted, executive orders altered, and states of emergency are rescinded the litigation process will begin again.  We anticipate a significant backlog in many areas as courts that have been dark for weeks or months begin accepting claims, and we are equipped with a plan to properly manage the process from beginning to end.

We don’t know how this story ends.  We all want a “return to normal” in a matter of months, but the reality is that it could take much longer and “normal” may look a great deal different.  At this time, we demonstrate our leadership as we continue to monitor state-level issues, communicate with our clients and treat their customers with the care they deserve in this difficult time.     

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