Rethinking collections through a regulatory and compliance lens
Across Australia and New Zealand (ANZ), financial institutions are under intensifying scrutiny from regulators like ASIC and the FMA.
Collections practices, once seen primarily as operational levers, are now a key test of an institution’s commitment to customer fairness, data ethics, and social responsibility. And with updated hardship frameworks, heightened consumer vulnerability awareness, and stricter conduct licensing regimes, compliance has become a strategic imperative.
So where does technology fit into this picture? In this blog, I’ll dive into how collections technology isn’t just about efficiency, but it’s increasingly enabling compliance by design, and allowing a more rapid response to change.
Turning technology into a compliance enabler
At Arum Global, we’ve seen how the right technology architecture can embed regulatory requirements directly into the collections process.
Here’s how modern platforms support key regulatory priorities:
1. Early identification of vulnerability and hardship
Advanced analytics and AI tools help flag customers showing early signs of distress. This aligns closely with expectations from ASIC and the CCCFA that lenders act proactively and empathetically. Tailored segmentation ensures that outreach is timely, appropriate, and supportive, not punitive.
2. Explainable AI and ethical decisioning
As institutions introduce machine learning into collections strategies, explainability becomes non-negotiable. Regulators want clear rationale for why a customer received a particular message or repayment plan.
Organisations need to ensure they have the right governance frameworks, transparency protocols, and appropriate oversight to align with evolving regulatory expectations around ethical and explainable decisioning.
3. Digital journeys that respect consent and conduct
Digital self-service platforms, omnichannel messaging tools, and interactive portals all enhance efficiency. But in a regulated environment, they must also demonstrate fairness. That means managing outreach frequency, capturing consent, and offering accessible hardship support channels, all core components of a compliant platform design.
4. Integrated support pathways
Modern collections platforms increasingly offer built-in access to hardship applications, financial counselling, and even mental health support. These features are not just customer-centric, they are becoming regulatory expectations, particularly under new conduct regimes that demand a holistic view of customer wellbeing.
5. Governance and control frameworks
Ultimately, technology must be governed. New systems should come with the right layers of risk control, performance monitoring, and compliance oversight. From vendor selection to platform deployment, governance must be built in, not bolted on.
Learning from global regulation: The UK as a barometer
The UK regulatory landscape is often viewed as a bellwether for global financial services reform. Many of the conduct, vulnerability, and AI-related standards being explored in ANZ have precedents in the UK. For example:
- The Financial Conduct Authority’s (FCA) Vulnerability Guidance, released in 2021, set a clear expectation that firms identify and support vulnerable customers. This has close parallels to the CCCFA reforms in New Zealand and ASIC’s guidance in Australia.
- The FCA’s Consumer Duty framework, introduced in 2023, requires firms to deliver good outcomes across four key pillars: price and value, consumer understanding, products and services, and customer support. Similar outcome-focused mandates are increasingly influencing ANZ regulatory thinking.
- UK financial institutions have led in embedding fairness, transparency, and inclusive design into collections journeys, approaches which are increasingly being adopted in ANZ.
Why it matters now
With regulators placing collections under a microscope, institutions need to future-proof their operations. Technology provides the scale and structure, but only if implemented with compliance at its core.
That’s where Arum Global comes in: we blend strategic insight with delivery know-how, helping financial institutions turn regulatory pressure into a platform for responsible growth.
How Arum Global can help
Arum Global is a leading, independent collections and recoveries consultancy, with a global footprint and deep experience in building future-ready collections operations that align with regulatory and customer expectations.
We are platform-neutral, focusing solely on delivering sustainable outcomes, whether that means vendor selection, platform configuration, or full operating model redesign.
If you're considering how to transform your collections environment in a way that satisfies both your customers and your regulators, take a look at our helpful resources below or contact us directly to discuss your needs.
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About the author
James Breadon
Senior Business Development Manager
James is a financial services specialist with over a decade of experience across collections, recoveries, lending, and credit data. He has led strategic growth initiatives at major firms including TDX Group, Capquest, TransUnion, and Oakbrook Finance, delivering high-value partnerships and credit lifecycle optimisation. At Arum Global, James oversees clients across the UK and APAC, helping organisations transform their collections and recoveries performance through data-driven and technology-led solutions.