In today’s fast-paced digital age, text messaging has become a critical communication tool for collection agencies. According to the Cellular Telecommunications Industry Association (CTIA), last year Americans exchanged 2.1 trillion text messages with a 98% open rate. However, ensuring the successful delivery of these messages requires navigating a complex landscape of regulatory compliance and technical requirements. For text messaging vendors, who work within the collections industry, understanding these nuances is essential to providing effective and compliant services. Within this article, we will explore what text messaging vendors need to do to ensure text messages are delivered successfully, what businesses should look for to remain compliant, and when to consider using a 10-digit Long Code (10DLC) or a Short Code.
Compliance:
Compliance is the cornerstone of effective text messaging in the collections industry. Adhering to regulations not only protects businesses from legal repercussions but also fosters trust and credibility with consumers. Non-compliance can result in hefty fines, lawsuits, and damage to the company’s reputation. Moreover, following regulatory guidelines and providing documentation of your compliance processes builds trust with the mobile carriers who ultimately determine whether your messages are sent. Below are a few compliance points to consider.
● TCPA, FDCPA, and the CFPB: Messaging Vendors must ensure that their services comply with the Telephone Consumer Protection Act (TCPA), the Fair Debt Collection Practices Act (FDCPA), and the Consumer Financial Protection Bureau (CFPB). This includes the message content, obtaining consent (or prior consent) from consumers before sending messages, and providing opt-out mechanisms.
● CTIA Guidelines: Adherence to the Cellular Telecommunications Industry Association (CTIA) guidelines is crucial. Vendors should follow and provide examples of best practices for message content, frequency, and consumer privacy to their customers.
● Message Filtering: The messaging vendor must use a robust message filter to prevent spam and fraudulent messages. This helps maintain high delivery rates, avoid carrier blacklisting, and gives the Mobile Carrier additional peace of mind.
● Personalization and Relevance: Crafting personalized and relevant messages can reduce the likelihood of messages being flagged as spam. Incorporating additional information regarding the original creditor and balance details can go a long way. Ensure that the content is clear, concise, and respectful.
● Timing and Frequency: Sending messages at appropriate times and limiting the frequency can improve engagement and reduce opt-out rates. Avoid sending messages during unsociable hours or too frequently.
● Compliance: Message content must meet the regulatory guidelines. The messaging vendor should request sample messages from the company to provide to the mobile carriers for approval.
“O Twilio, Twilio, wherefore art thou Twilio?”
As we all now know, Debt Collection is listed as a “Forbidden Message Category.” As the industry saw in 2022, Twilio cited third-party debt collection as a prohibited use case, not just prohibited content, which means that all messages from third-party collectors are prohibited. The reason for Twilio’s actions is unclear, but during the previous year, both T-Mobile and AT&T released updated “Guidelines” that included additional restrictions on debt collection messaging. These new guidelines made it clear that the mobile carriers were taking a proactive approach to prevent a “Spam Likely” or “Stir Shaken” environment like we have today with traditional voice calls. Therefore, a deep commitment to compliance is critical for both operational success and long-term sustainability for messaging vendors who service the collections industry.
To prevent another Twilio-type event, vendors should:
● Establish Carrier Relationships: Establishing strong relationships with mobile carriers can improve message deliverability and potentially prevent red flags and fines. Vendors should collaborate with mobile carriers to understand their filtering policies and ensure that the messages sent comply with their standards. This relationship is vital to the success of everyone involved and it starts with knowing and respecting the carrier’s requirements.
● Ensure Platform Requirements: Vendors should have a platform that integrates easily into their collection software so that regulatory requirements can be met and managed. Consent should be documented, and filters should be used to ensure that messages comply with the CFPB requirements for text messaging.
● Utilize High-Quality Routes: Using high-quality messaging routes that prioritize reliability and speed over cost can avoid less-than-desirable mobile carriers and significantly enhance delivery rates.
● Offer Delivery Reports: Providing detailed delivery reports and analytics, in real-time, to clients helps track message performance and identify any issues promptly so mobile carriers can be notified.
Compliance Best Practices
Businesses using text messaging services for collections must prioritize compliance to avoid legal repercussions and maintain consumer trust. Key considerations are:
- Consent: Ensure that consent, whether explicit consent or prior consent, is documented or obtained from consumers before sending any messages. This includes clear documentation of where the consent was obtained for audit purposes. It’s better to be safe than sorry.
- Opt-Out Mechanism: Provide a simple and clear opt-out mechanism in every message. This can be as simple as replying with “STOP” to unsubscribe.
- Audit Trails: Maintain comprehensive audit trails of all messages sent, including timestamps, content, and delivery status. This is crucial for demonstrating compliance during audits.
- Regular Training: Conduct regular training for staff on compliance requirements and best practices for text messaging in debt collection.
When to use 10DLC or Short Code?
10DLC, or 10-Digit Long Code, is a messaging solution designed for businesses to send application-to-person (A2P) messages using standard 10-digit phone numbers. Here’s when to consider using 10DLC: - When to Use 10DLC:
○ Conversational Messaging: 10DLC numbers are ideal for customer-business interactions, 2 Way messaging, and free-form agent-to-consumer conversations.
○ High-Volume Messaging: If your collection agency sends a high volume of messages, 10DLC can provide a reliable and cost-effective solution compared to shortcodes.
○ Local Presence: 10DLC can enhance local presence and familiarity, as messages come from recognizable local numbers.
○ Time to Market: 10DLC numbers can be set up and in production in 2-3 weeks. - When to use a Short Code:
○ Brand Awareness: Premium or Vanity short codes allow you to spell out your brand name or a significant word using your mobile phone’s dial pad. Examples include 827438 for “Target” or 262966 for “Amazon.”
○ Less Spam Filtering: Dedicated short codes have established strong trust from mobile carriers, so there’s less concern about messages being filtered out and not getting delivered. However, Short Codes are heavily regulated and scrutinized during the application process.
○ High-Volume Messaging: Short codes are excellent for high-volume informational use cases specifically. If you need to send out hundreds of time-sensitive messages at once, shortcodes will provide you with the highest possible deliverability rate due to the extensive nature of the short code registration process.
Conclusion
Text messaging vendors working with collection agencies must navigate a complex landscape to ensure successful message delivery and compliance. By prioritizing regulatory compliance, leveraging robust technical infrastructure, and considering the appropriate use of 10DLC, vendors can provide effective and reliable messaging services. For businesses, ensuring explicit consent, maintaining clear opt-out mechanisms, and keeping detailed audit trails are essential practices. By adhering to these guidelines, both vendors and businesses can enhance their communication strategies while maintaining compliance and consumer trust.