TrueAccord’s machine learning engine, HeartBeat, reportedly reaches out to every account placed with a goal of getting them to repay on their own terms when they are ready, versus the one-size-fits all communication “that ignores trends in sentiment and spending habits.”
Powered by a combination of data-driven heuristics, the latest compliance regulations, and machine learning—continuously refined by data from our 20 million customer engagements and counting—HeartBeat dynamically “optimizes the next best touchpoint for every consumer in real-time, including the content, timing, and channel for each customer.”
It leverages interaction signals to “identify consumers at risk of breaking plans and automatically adapts to keep them successful until resolution.”
The TrueAccord approach aims “to engage and empower no matter where the roller coaster may be taking individual consumers.”
As they continue to listen, learn, and innovate, they claim to “remain committed to delivering exceptional debt collection experiences that prioritize consumer well-being paired equally with debt recovery.”
At the end of 2023, economists were hoping for a “boring” 2024—just a relatively uneventful year thanks to a soft landing “with downward trends for inflation, unemployment, and interest rates.”
But instead, the first half of 2024 has “been an economic roller coaster for consumer spending, resulting in a whiplash for consumer sentiment.”
While the soft landing may still be on track, that track “doesn’t appear to be as straightforward as hoped.”
There is an onslaught of mixed messages:
Consumers are proving to be “more resilient than expected as they continue to spend, staving off what had been predicted to be an inevitable recession.”
Versus
Consumers are actually financially stretched “from depleting their pandemic-era savings and battling ongoing inflation and higher interest rates.”
And between these highs and lows, “a serious fact remains for businesses: delinquency transition rates have increased across all debt types.”
But for companies looking to recover those delinquent funds, “understanding how to communicate with consumers where they are in this roller coaster can mean the difference between repayment and write-off.”
Up and down the economic roller coaster goes, but “the ride may be feeling different for different subsets of consumers: Americans with higher incomes have continued to spend at healthy rates, yet lower- and middle-income consumers are starting to pull back.”
This “split-spending” pattern hasn’t been the case in recent years—pandemic-era benefits, a savings surplus, and rapid wage growth “resulted in consistent spending rates across all income groups.”
But as excess pandemic savings decline “at the same time as both inflation and interest rates increase, lower-income consumers are feeling the squeeze while higher-income consumers are mostly unaffected.”
And even when there is a spending uptick in the lower-income sector, like we saw in April 2024, what these consumers are spending “on and how they are paying for it is still quite different from their higher-income counterparts.”
These spending patterns show that consumers are “trading down,” or changing the type or quantity of purchases for better pricing and value, and are starting to put more everyday bills on credit cards—and in turn, credit card delinquencies and “charge-offs for low-income consumers are returning to their pre-pandemic levels faster than other groups.”
Regardless of where on the financial spectrum individuals may fall, “an overall slowdown is expected.”
According to a Fitch Ratings report, annual consumer spending growth “will lower from 2.2% in 2023 to 1.9% in 2024, with much of the slowdown expected in the second half of the year as income growth decelerates, pandemic savings dissipate, and higher interest rates persist.”
