All the signs are there that consumers are feeling the economic strain, from rising unemployment rates to this year’s recently reported falling retail sales, says Richard Mukheibir, CEO of Cash Converters Southern Africa. Reflecting these circumstances in empathetic debt collecting approaches means the company now boasts a success rate of two out of three loans clawed back from default.

“People are still haunted by that adversarial historic image of rough-and-ready debt collectors,” he says. “Thankfully, that kind of abuse is illegal now. It pushed everyone to rethink their credit and debt procedures and for us, that now means reinforcing a spirit of ‘collecting with kindness’ among our call-centre consultants. The results speak for themselves with collections up 72 per cent year on year.”

The improvement has come thanks to better technology to track and follow up debt patterns among borrowers, says Mukheibir, and to the “make friends” approach introduced by Cash Converters Debt Collection Manager Adele Lewis, who joined the company early in 2016. This synergy has seen collections rise more than 50 per cent since then.

“We can see that most consumers intend to honour the debt that they take on,” says Mukheibir. “The ‘credit criminals’ who take on debt with no intention of servicing it are few and far between.” But all too often circumstances change and borrowers who had the best of intentions find themselves faced with demands on four credit agreements or loans and only enough cash in hand to pay one.

“We believe we are here to help people get on with their lives,” says Mukheibir. “That includes remaining approachable and where possible helping a customer avoid a worsening credit-bureau rating.”

Debt collection is very similar to sales and establishing a relationship with the customer makes all the difference, says Lewis. To make your debt the one that the consumer chooses to pay when times are tough, you need to be listening to find out what works for both parties so you can keep the consumer in the paying cycle, even if that means reducing payments to R100 a month until the consumer’s circumstances improve.

The company’s debt consultants are trained and mentored by Lewis to build a “cradle to grave” relationship with the customer. As a result, consultants are often greeted by name by “their” customers – “Hi, Alice, it’s you again”. In turn, customers often take the initiative to contact “their” consultant to say, “I’m ready to raise that repayment to R300 a month now.”

Adding WhatsApp to its voice and SMS customer-contact channels has further boosted the company’s customer-friendly approach. It has also decreased the number of dropped calls when the call centre is at its busiest.

Customers enjoy communicating with the company on the WhatsApp platform because it is more discreet than responding to a voice call about personal finances in the middle of an open-plan office, for example. If they are working shifts and can only communicate after hours, they can choose to respond whenever is most convenient for them, even if this is at 10pm or 5am. With all debt consultants registered to use this channel on the company’s behalf, it has increased their productivity as they can maintain five or six WhatsApp conversations at once, which would be impossible with a voice call.

“WhatsApp works for many customers while for others, it is an ice-breaker that leads us into a voice conversation or an e-mail exchange, whichever works best for them,” says Mukheibir. “A friendly and understanding approach to collections brings a better debt outcome for customers and companies.”

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About Cash Converters

Cash Converters Southern Africa was co-founded in 1994 when Richard Mukheibir (Chief Executive Officer) and Peter Forshaw (Chief Financial Officer) bought the licence to establish a master franchise of the Australian brand, the world leader in trading and marketing second-hand goods and now the world’s largest cash and asset converter. Cash Converters Southern Africa purchases merchandise from customers, enabling them to have instant access to cash. Since 2007, it has also offered short term loans against a customer’s valuables or against their salary. Cash Converters Southern Africa is built on a solid foundation of franchisee owner operators, guided by core values of passion, professionalism, integrity, respect and collaboration. It has already empowered nearly 100 franchisees to run their own businesses and create their own wealth. Each franchise store, in turn, provides job opportunities for an average of 12 employees, each supporting about five other people. This network of businesses is supported by robust processes and systems and ongoing training programmes for franchisees and staff.

Dynamic growth of up to 20% per annum has created more than 84 Cash Converters stores in Southern Africa (as at 1 January 2018). These stores will have a combined annual turnover in excess of R1.7bn across all products and services in 2018.

They are part of the rapidly expanding Cash Converters International network of more than 740 stores around the world. These can be found in such diverse countries as Australia, the founding country, the United Kingdom, Singapore, New Zealand and the UAE, as well as France. Cash Converters Southern Africa was a finalist for the Franchise Association of South Africa Franchisor of the Year Awards in 2014, 2015 and 2016.