Collections and repossessions was perhaps the sector of the industry that saw the most disruption during the Covid-19 pandemic, with a wave of regulatory changes keeping companies on their toes in a delicate environment.
Motor Finance recently sat down with Simon Shuttleworth, managing director of Peak Collections, to discuss how the company adapted to life under lockdown and navigated the tricky regulatory conditions.
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When the virus first forced national closures back in March 2020, the sector saw all outbound client instructions halted and auction delivery points close, explains Shuttleworth. “We continued to collect police and DVLA seizures to minimise storage charges, having space at our various sites. End of term PCP cases soon joined these collections as many vehicles were parked uninsured at the roadside, so storing and insuring them on our sites was crucial for a while.
“We took the decision not to work from home due to system security protocols. Fortunately, we have ample space here so staff were able to adhere to social distancing requirements and set up the office following all Covid guidelines.
“The lockdown also provided us with an opportunity to review and improve all of our processes. As a result, we have made several enhancements to our systems automation, staff training, and have almost completed our accreditation to ISO:27001 – we are just waiting for our external UKAS audit now.”
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By GlobalDataHot on the heels of the first lockdown was a series of regulatory measures from the Financial Conduct Authority (FCA), designed to support motor finance consumers facing payment difficulties due to Covid-19. This included a three-month payment freeze for customers who needed it, a ban on altering original customer agreements, and a ban on repossessions with no additional fees or charges to the consumer.
“Despite remaining fairly busy on PCP and voluntary termination (VT) collections, as regulations changed, we began to look again at parked repossession cases on our system, starting work on a consent process for these cases,” Shuttleworth says.
The firm also implemented automated contract strategies as a result of the pandemic, with Shuttleworth reporting a high success rate for consenting repossession cases. “We did, however, note a difference in success rates between consumers already in arrears pre-pandemic and consumers falling into arrears following the first lockdown.
“We have also observed an uptick in vehicles being exported, as European consumers exiting the UK during the travel windows that were available.”
Another consequence of the pandemic has been the global shortage of semiconductor chips and the lesser-publicised shortage of available chassis cabs to order. Peak Collections was able to increase its fleet throughout the pandemic, despite the challenges. Last year, new cars had to be mothballed on delivery and are only now slowly coming into work.
The ongoing chassis cab shortage continues to pose a problem for the business, says Shuttleworth. “In March this year, we had manufacturers quoting delivery slots for new chassis cabs between December this year and March 2022, depending on the chassis weight limits.
“As we are expecting an increasing volume curve throughout the rest of 2021, we have numerous additional 5.5t and 7.2t chassis cabs on order, both planned for additional fleet and replacement of the 3.5t fleet as it hits four years old, to cope with ever-increasing vehicle weights.
“There is currently an element of guesswork in the number of additional vehicles that will be required, but we’ve taken the view to place the orders, and bring forward our fleet replacement program if necessary. This will speed up the process of becoming a fully HGV fleet.”
Internal upgrades
With a fresh necessity for remote and accessible processes, Peak Collections upgraded its pre-existing systems and rolled out an automated voluntary surrender (VS) solution.
“We refreshed our website to tie in with the new client TouchPoint system,” Shuttleworth notes. “This has different levels of login for clients’ staff depending on requirements. The upgraded platform features multi-factor authentication; an enhanced case view system, featuring additional screen and history views; KPI metrics and a full governance section covering licences, insurances, accreditations and policies. This will enable clients to audit us remotely at any time and check our adherence to the new FLA Industry Standard.”
Also included will be the firm’s automated VS feature, which will enable clients to create cases via the portal for VS and VT cases.
“While our clients have the customer on the phone, the system creates the case, issues the required secure documentation for the e-signature, including multi-factor authentication. As soon as the customer signs the documents, the system dispatches a signed copy of the document to the customer and client, launching our VS/VT contact strategy to arrange collection.
“Where this process can currently take several weeks for some clients, the whole thing can now be done in less than an hour, with vehicle collection the next day, without any intervention on our part.”
The Touchpoint platform is now live, with the company also working on a new dashboard to provide fully real-time graphical data on every performance metric – including full drill-down functionality to individual case history.
Shuttleworth explains: “A client could be watching a pie chart around PCP collections continually changing as collections are arranged and vehicles delivered. Any cases showing as ‘yet to be booked for collection’ can be accessed by simply navigating to the relevant section, clicking into the case history to see exactly what has been done on the case. The dashboard will cover all case types with date range selection available.”
