When it comes to collections, is your strategy more like casting a giant net and hoping you catch something? Or are you a skilled angler, using the right bait and targeting the exact fish you want to catch? Too many accounts receivable (AR) teams are stuck with the “giant net” approach, feeling stretched thin and lacking clear visibility into which tactics actually work best for debt recovery. The good news is that you can move from a game of chance to a strategy of precision with AI approaches to collections.
As we learned in our recent webinar, “Timing, Targeting, and Technology: Your New Collections Playbook,” the right strategy can solve the core challenges that have AR teams feeling stuck in a reactive loop.
3 Key Takeaways:
- Target smarter: Use dynamic segmentation to focus on the accounts that matter most.
- Master timing: Leverage machine learning to optimize outreach across channels and avoid customer fatigue.
- Balance AI + human judgment: Let automation handle personalization at scale while collectors focus on relationships and nuance.
Watch the webinar replay with Billtrust’s V.P. of Product, Dave Ruda, and Custom Truck One Source’s Manager of Credit and Collections, Sean Gabel, and keep reading for the full recap.
The Mindset Shift: AR collections as a relationship Hub
It all starts with a simple but powerful shift in perspective. Too often, we think of accounts as being “in collections”—a reactive and often negative status that implies a failure has already occurred. The modern approach is to see the work as a current state with upside potential: “We are collecting.” This reframes the entire function from an uncontrollable past action to a forward-looking operation.
This means treating your collections operation like a Customer Relationship Management (CRM) platform for AR. Instead of just chasing debt, the focus should be on managing customer communication from the onset. This fresh mindset immediately frames the three most important questions:
- Who do you contact?
- When do you contact them?
- And what do you say?
Let’s explore these three questions and the automated collections software Billtrust brings to the table.
Collections: The CRM of your AR
Who do you contact?
When do you contact them?
What do you say?
Problem 1: “My team is overwhelmed sorting through the delinquent accounts catch.”
A one-size-fits-all strategy typically treats every account the same, thereby wasting your team’s time. This can damage relationships with your best clients through unnecessary contact. For example, when you cast a giant net, you catch everything — the high-risk accounts you need to talk to, and the low-risk ones too. This amounts to prompting reliable payers you may not even need to address.
The largest single-source provider of commercial trucks and equipment, Custom Truck One Source, for example, takes a nuanced approach. “We’ve taken on a strategy of looking at the different business lines and segmenting our customers out,” Sean shared. “Some of them require more of a soft touch. We look evaluate whether they’re a large national company versus a small sole proprietor and determine if need to be handled differently.”
Teams Are Overwhelmed
In a live poll during the webinar, “team bandwidth and resources” was the #1 challenge cited by attendees, with “lack of automation” coming in a close second.
The solution: Use AI to automate collections
Instead of trying to hit every target, you can use automated collections software to identify the exact fish you’re after. This is where a tool like Billtrust’s AI-powered Autopilot Segments becomes your sonar, automatically pushing the highest-risk accounts to the top of the queue.
Target overdue invoices with the intelligence of payment behaviors
Using dynamic data analysis and machine learning, it tracks payment behavior over time and automatically categorizes customers into low, medium, and high-risk levels. This provides clear visibility:
- quickly spotting consistently reliable payers,
- recognizing those who might need a nudge, and
- prioritizing the high-risk accounts that need immediate attention.
With a targeted collection strategy, collectors can optimize outreach and reduce customer fatigue.
Buyers without a payment history are placed in an “In Review” bucket until their patterns become clear. And this doesn’t mean you lose control. Any existing rules-based segments for customers still apply. Your VIPs will still be your VIPs. The system even shows you how these custom segments overlap with the AI-driven recommendations. But identifying who to contact is only half the battle. The next challenge is knowing when to reach out, and through which channel, so that your message actually lands.
Problem 2: “We’re casting the net everywhere, but we don’t know where the fish are biting.”
How do you know the best time to reach out or which communication channel will be most effective? For too long, the answer has been a mix of gut feelings and rigid, outdated schedules. But static dunning schedules are the strategic equivalent of casting a giant net in the same spot every day and just hoping for a good catch.
“Static dunning schedules are the strategic equivalent of casting a giant net in the same spot every day and just hoping for a good catch.”
Dave Ruda, VP of Product, Billtrust
This was a top concern for Sean Gabel, who pointed directly to “customer fatigue” as a factor in collections failure. He noted that without clear risk indicators, collections procedures are often set up based on anecdotal feedback from sales teams—a very common approach that lacks a data-driven foundation.
When you’re doing everything at once, you can’t tell what actually worked. Was it the first reminder, the third dunning email, or the phone call that finally prompted the customer’s payment? The core issues here are a lack of actionable data and clear attribution, leaving collections managers guessing about their moves.
The solution: Master the timing game with AI analytics and the industry’s largest buyer data network
The key is to build different outreach procedures—or automated workflows—for each customer segment and then measure everything. But what is the most effective way to do that? The answer lies in machine learning that ingests information from both internal and external sources. That is: your own customer data and anonymized data from the Billtrust network – the industry’s largest buyer data network touting insights from 13 million buyers.
Think of it as a built-in data scientist
You set the goal, and the machine analyzes all the signals to determine the best sequence of actions, the best timing, and the best communication channels. It tells you what worked, what didn’t, and what drove to the ultimate outcome: getting paid.
AI recommends how to optimize collections outreach
This intelligence is used to marry your customer segments to optimized collections outreach procedures. Here’s how it works:
- The system proactively makes recommendations for your existing workflows.
- It allows you to leverage pre-built procedures that have been optimized with data from across the network to drive the best results.
- In short, you get a clear picture of what’s effective, allowing you to stop guessing and create a collections engine constantly being optimized for the best results.
“Powered by Agentic AI, Agentic Procedures are collections communications that evolve in response to changing customer payment behaviors. They adapt all the time, so your team doesn’t have to worry about trying to keep up.”
Dave Ruda, VP of Product, Billtrust
Of course, timing means nothing if your message gets lost. Which leads to our next section: There’s still the problem of what words will influence the payment.
Problem 3: “We’re shouting into the ocean and can’t hear the replies.”
Even if you know who to target and when to reach out, the final challenge is communication itself: what do you say? And just as importantly, how do you manage the thousands of replies that come flooding back?
“Sending out mass emails is like shouting into the ocean; the real work is trying to hear and understand every individual response. It’s no surprise that teams feel exhausted by the flood of responses coming in.”
Dave Ruda, VP of Product, Billtrust
Our webinar poll revealed that while 58% of collections teams are “partially automated,” a significant 36% are still “mostly manual.” Only 6% described their process as “fully automated.” This means collectors are spending their days as inbox administrators, manually sifting through promises-to-pay, disputes, and questions instead of performing high-value work.
The Solution: Give every collector an AI-powered crew
A modern collections strategy automates the listening activity, understanding, and strategizing in response. This is where a multi-agent approach to AI – one that deploys multiple virtual assistants – steps in, giving AR teams the crew they need to manage communications en masse.
Here’s how Billtrust assists collectors:
- An agent to manage your inbox: Billtrust Agentic Email capabilities act as a first mate, reading every inbound customer email, summarizing its intent, and creating a clear to-do list for the collector. It turns hours of manual sifting into a simple, one-click task.
- An agent to watch the horizon: Predictive intelligence extends to credit risk management with Billtrust Agentic Credit Lines. This agent acts as a lighthouse lookout, using contextual intelligence to provide recommendations regarding credit limits. This agent helps you steer clear of risk from the very beginning — even informing what you say to new customers from day one.
- A smart dashboard to boost performance: Billtrust’s advanced analytics dashboard helps collectors gain granular visibility into performance metrics like Collections Effectiveness Index and Average Days Delinquent (ADD) across portfolios, buyers, and collectors.
Plus, you can leverage cross-product data—including cash application and payment transactions—to uncover bad debt risk and new opportunities to offset it.
Next-Gen Collections: Data-Backed Tips to Get Invoices Paid Faster
Discover data-driven collections best practices that increase recovery rates.
With AI shouldering the heavy lifting, the role of the human collector naturally shifts. So where do people fit in an AI-driven world?
Where humans fit in an AI-driven world
As powerful as these new tools are, they don’t replace the angler. As Sean noted, the future requires teams to be more analytical and data-literate, but it doesn’t remove the need for human judgment. AI provides the map, but your team’s intuition and common sense are still needed to navigate the terrain. Learn how to run an effective collections team.
“This is very situational,” he said. “Specific procedures for your VIP accounts should be a little more fluid, a little less rigid. You’re always going to have that human element that’s going to be needed to apply and differentiate… I don’t think you’ll ever see that be replaced.”
The new AI collections playbook
The path to an innovative collections department is clear. It requires a new mindset, playbook and strategy built on three powerful pillars:
- Target smarter using dynamic AI segmentation to focus debt recovery efforts.
- Master the timing game with procedures and attribution founded in data science.
- Use AI as your strategist to automate, optimize and scale collections outreach.
See how this playbook can enhance your debt recovery. Request a personalized product demo.
