Back to News
Utilities tighten credit and collection practices as write offs have trended upward, Chartwell reports
ATLANTA, July 22, 2010 – Many North American utilities have employed a variety of tactics to offset revenue losses brought on by a continuing economic slump, from automated notifications of overdue bills to expanding payment plans for customers struggling to make ends meet, Chartwell reports in its latest study of utility credit and collections trends.
The best strategy, Chartwell found, is a combination of most or all revenue assurance and collections tactics. These include: risk mitigation such as credit checks, proper customer identification and security deposit; a close monitoring of accounts and payment patterns during the customer life cycle; and, if customers fall into arrears, prompt notification of payment amount due, and a sound system for working out payment extensions and customer assistance for those in need. Utilities must also enforce a strict disconnect policy when the situation escalates to the point where customers don’t pay their bill or respond to utility notifications, Chartwell found.
Credit and Collections in the Utility Industry 2010 reports that utilities have experienced increased losses for unpaid energy usage for three straight years. Most of the utilities taking part in the survey, however, felt that write offs as a percentage of overall revenue would likely stabilize in 2010, a much more optimistic view than that of last year’s survey respondents.
Chartwell interviewed 23 utilities earlier this year about the recession’s impact on their current credit and collections practices as well as on revenues. Additional utilities provided metrics around write offs to overall revenue. The findings are reported in Chartwell’s Credit and Collections in the Utility Industry 2010, which also includes other metrics, such as service disconnection numbers.
Credit and Collections in the Utility Industry 2010 is available to members of Chartwell’s Customer Care Service. For information on membership or Chartwell’s research, contact Kristy Dickens at (800) 432-5879 , (404) 237-9099 , ext. 25 or kdickens@chartwellinc.com; or visit www.chartwellinc.com or Chartwell’s EnergyLibrary at www.energylibrary.com.
ABOUT CHARTWELL INC.
Chartwell is an independent information firm that produces in-depth, objective research on customer-facing issues within the utility industry. With its research as the foundation, Chartwell offers conferences and other educational events where utility leaders and Chartwell analysts discuss successful programs, innovative strategies and solutions to the industry’s most pressing issues.
PRESS CONTACT
Dennis Smith
40..., ext. 31
dsmith@chartwellinc.com
