Our long-term client, a consumer finance company, had experienced a sharp decrease of recovery indicators across all stages of late collections at its branch in Vietnam. The ABC team was invited to investigate the problem and suggest a solution. After a quick analysis of cure rates at all stages of delinquency, it became obvious that the problem was with booked vintages rather than process mismanagement (the graph below shows cures rate development after 90 DPD, but the situation looked similar for other stages). However, that was not the end: during the week of interviews and pre-onsite reports study, the ABC team identified four major areas that needed attention to focus for the next two months:


Field Collections Process


External Agency Management Process


360+ DPD Portfolio


Collections Management Reporting

Field collections process was redesigned to make use of certain specifics of the Vietnamese market and culture, remove inefficiencies, and increase pressure on the client if initial field activities prove to be ineffective.

For better management of external agencies we proposed shortening of assignment period and a change of the commission scheme, which would create a more competitive framework for the agencies: the more effective you are, the higher your rate is. We also helped the client to define formal rules of external agency assignment process and to prepare for implementation of new process in the collections system.


“Our segmentation of debtors identified those who were more likely to pay than others.”


During the initial offsite review of reports we noticed that a rather big chunk (45.7%) of overdue portfolio was in the 360+ range. We proposed to run a pilot of “washing” this segment by internal capacities and compare it with the performance of external agencies on the same segment. The results proved our segmentation of debtors identified those who were more likely to pay than others, so our client could later use it to “wash” at least the best (or best of the worst so to say) contracts internally before sending them to external agencies. The pilot also showed which methods of internal collection were more cost-efficient than external agencies.

As a cherry on the top, we prepared for our client a mock-up of management reporting, which provided a clear of overview of the situation at all stages of collections, including operative results of the call center and field collectors, efficiency of external agencies, and flow of cases from method to method.

All our recommendations are aimed at improving the bottom line. This two-month collections project in Vietnam resulted in estimated 20-25% increase in future cash collected after the implementation of our suggestions.