Blog & Insights
Human Test for AI in Collections: 5 Questions to Ask Before You Automate a Consumer Interaction
If you're evaluating AI for collections, you may be asking yourself where it belongs in your business.
Many in the ARM industry see opportunities to use AI to streamline routine interactions, provide additional support to consumers, and help teams work more efficiently. The bigger challenge is determining:
- Which interactions are appropriate for automation; and
- How to create an experience consumers can trust.
This is especially important when consumers are dealing with disputes, financial hardship, fraud concerns, or other situations that don't fit neatly into a predefined workflow.
During a recent discussion hosted by insideARM, AI—Convenient for who? the panel explored this challenge from several perspectives. One theme surfaced repeatedly throughout the conversation: Successful AI initiatives begin with a clear understanding of the human experience you're trying to improve.
Before automating a consumer interaction, consider these five questions.
1. What problem are we actually trying to solve?
"Sometimes you need to be able to just work through those different scenarios instead of, ‘Here’s all the fun stuff we get to do with AI . . .’ It's less about that, more about, does it actually solve the use case that you need it to solve?” – Angie Erwin, VP of Risk and Compliance, Finvi
AI can be applied to countless use cases, which is why it helps to start with a clear objective.
Whether you're considering AI-powered self-service, virtual assistants, call summaries, interaction analytics, or something else, the first step is defining the challenge you're trying to address. Is the goal to:
- Provide support outside business hours?
- Help consumers get answers more quickly?
- Reduce repetitive work for agents?
- Improve the consistency of information provided to consumers?
A clear use case creates a stronger foundation for implementation, evaluation, and governance. It can also help you determine whether AI is the right solution in the first place.
Before introducing automation, try stating the problem in a single sentence. If the objective isn't clear, the path forward probably isn't either.
2. Would this experience work if you were the consumer?
"We should always take a more conservative, more responsible approach that takes us back to essentially being a consumer, putting ourselves into their shoes." – Leonard Yampolsky, CIO, NCB Management
Technology decisions often look different when viewed through the consumer's lens.
Imagine receiving a message about an account. You need an answer, clarification, or next step. Would the interaction feel easy to navigate? Would you know where to go for help? Would you trust the information being provided?
These are the kinds of questions you should ask when evaluating any AI-enabled experience.
This perspective can reveal issues that may not appear during system testing. An automated workflow may function exactly as designed but leave consumers confused, frustrated, or uncertain about what to do next.
Consider the time your team spends focused on compliance, operational performance, and efficiency. Evaluating the consumer experience from the consumer's perspective deserves the same level of attention.
Keep exploring responsible AI
Find practical insights and resources to help you balance innovation, risk, and consumer trust.
3. What happens when the situation doesn't fit the script?
"The thing I hear over and over and over again is, ‘They wouldn't listen to me.’" – Peter Barry, Consumer Rights Attorney
Consumers want more than answers. They want to feel heard and understood. And this is where automating consumer interactions gets complicated.
Many consumer interactions begin with a simple question, but the focus can change quickly:
- A consumer may need to dispute information
- They may be experiencing financial hardship
- They may believe there's been a mistake
- They may have questions that don't fit neatly into a predefined workflow
These situations highlight the importance of thoughtful escalation paths and human oversight.
If you’re evaluating AI, it’s crucial to consider how consumers can move from automation to human assistance when circumstances require it. The process should feel clear, accessible, and responsive.
How should you measure the success of an interaction? Workflow efficiency matters, but more important is whether consumers feel their concerns were acknowledged and addressed.
4. Are we making a good process more efficient?
"If you have a bad process in place, all you are going to do is put that process on steroids." – Leonard Yampolsky, CIO, NCB Management
AI can accelerate outcomes, which makes the quality of the underlying process especially important. In many cases, preparing for AI starts with improving the process itself.
Before you introduce automation, examine the workflows, policies, and practices already in place. Existing challenges rarely disappear when new technology is added. Complaint trends, recurring disputes, handoff issues, and inconsistent consumer experiences are all worth evaluating before implementation begins.
If you understand workflows, monitor performance, and continuously refine processes, you’ll be better positioned to capture the benefits of automation while reducing potential risk.
5. How will we know consumers trust the experience?
"The goal of that good AI experience is really that you're creating trust with your consumer." – Angie Erwin, VP of Risk and Compliance, Finvi
Trust influences every consumer interaction, and it's earned over time.
If you’re currently tracking operational metrics such as response times, containment rates, and productivity gains, those metrics provide valuable insight. But they only tell part of the story.
It's equally important to understand how consumers are experiencing the interaction.
- Are they getting the help they need?
- Are they successfully resolving issues?
- Are escalation paths working as intended?
- Are complaints, disputes, or feedback revealing opportunities for improvement?
Establishing trust with consumers requires continuous monitoring, thoughtful governance, and a willingness to adapt as consumer expectations evolve. Rather than being a one-time decision, AI implementation is an ongoing commitment to delivering experiences that consumers can rely on.
Bottom line: Keep the human element at the center
“It's very good to automate things. It is very good to optimize things. It carries substantial revenue gains, but nothing replaces responsibility. Humanity is essential.” – Leonard Yampolsky, CIO, NCB Management
AI has tremendous potential within collections operations, when implemented with appropriate governance, risk management and human oversight. It can provide faster service, streamline routine interactions, and give consumers more flexibility in how they engage.
Key to better outcomes is keeping the consumer experience at the center of every decision. This means taking time to understand the problem you're solving, evaluating interactions from the consumer's perspective, establishing thoughtful escalation paths, and continuously assessing whether the experience you’re providing is building confidence and trust.
The sophistication of your technology won’t matter to consumers. They’re only concerned with whether they received the information, guidance, and support they needed to move forward. It’s important to determine where automation adds value, where human judgment is essential, and how those two capabilities work together throughout the consumer journey.
Trust is earned when you apply technology with purpose, continuously evaluate the consumer experience, and remember that behind every interaction is a person looking for help.
Listen to the insideARM webinar replay AI—Convenient for who? to learn more from the expert panel. Access the replay here→
Evaluating AI for Collections? Start Here
Angela Erwin
As the Vice President Risk and Compliance and a Certified Compliance Receivables Professional (CRCP), Angela plays a pivotal role in navigating the complexities of the risk and compliance landscape. Her expertise enables Finvi’s products and services to be at the forefront of compliance, meeting applicable regulatory, security, and privacy standards. Angela is an internationally recognized compliance innovator and has garnered many professional awards for her achievements within her field. As a recognized national speaker, she shares her insights on critical legislation such as the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, federal and state consumer protection regulations, the Telephone Consumer Protection Act, Americans with Disabilities Act, and the Health Insurance Portability and Accountability Act. Angela’s dedication to excellence, coupled with her commitment to advancing industry standards, cements her reputation as a trusted advisor and thought leader in the risk and compliance arenas.
