Selecting a credit debt collection agency is possibly the most challenging and essential job. Some aspects you must consider while choosing a debt collection agency are:
- Experience and specialists
- Geographical existence
- Expertise
- Fees and charging model
- Client recommendations
- Debt Collector Provider has actually covered this topic in depth through various free collections reports and articles on this site.
Step II - Employing the Debt Collector and Establishing Procedures
As soon as you pick the collection agency, the first two steps you have to take are:
Enter into a contract with the agency;
Set up processes on how you are going to communicate with the agency.
You are likely to pass sensitive information to the collection agency such as your account receivables, consumer contacts, item and services rates, and so on to facilitate faster debt collection. You want to be sure that this information does not fall in the wrong hands.
Establishing procedures is a crucial step in handling the debt collection agency. The success or failure of your collaboration will depend a lot on how well-defined your processes are and how strictly they are followed. Important processes you have to specify are:
Internal procedures: You have to put in place a clear process on defining uncollectable bill and referring the case to the debt collector. You do not want to refer the case to the collection agency before you make a sincere effort to gather the charges internally.
Details transfer: How will you move the info to the collection agency about your dues and defaulting consumers, and how will you get the info from your collection agency? Debt collection software can make the details transfer procedure easy and secured.
Third party dealing: As pointed out previously, it is extremely important for you to ensure the security of the details you provide to the debt collection agency. The collection agency might utilize one or more of its associated firms to get information about defaulting customers. You need to set up a clear protocol on how much details they can share with such third parties.
Interaction: You have to set up single point contacts for interaction within the business and the collection agency. In debt collection practices, the timing of interaction is incredibly important and for this reason it will go a long way in deciding the success of your debt collection process. Once again, the significance of debt collection software can not be overstated here.
Step III - Efficiency Monitoring
Once all procedures are set, start keeping an eye on the efficiency of the collection agency. This is a continuous process when dealing with a collection agency. Crucial specifications to keep an eye on are:
Quantitative
- Variety of cases referred to the credit debt collector and percentage of cases effectively resolved by them.
- Portion of debt recovered by the collection agency from all cases referred.
- Portion of debt recuperated by the debt collection agency from fixed cases.
- Percentage of quantity paid as fees/commission to the collection agency to the total uncollectable bill cases referred to them.
- Typical number of days taken by the debt collector for full/partial credit collection.
Qualitative
* How well do the debt collection agency professionals handle your customers?
* Has the debt collection agency followed all legal requirements mentioned in the Fair Debt Collection Practices Act?
* Has the debt collection agency gone beyond the provisions of the Fair Debt Collection Practices Act?
* Has the debt collector followed all guidelines and procedures set by you?
Step IV - Contract Closure
Ideally, the selected debt collector will work best for you. But if it does not, then you have to transfer all your debt collection procedures from the agency. You need to remember the following essential points when you are ending the agreement:
Confidentiality and non-disclosure stipulations are applicable even after completion of the contract with the debt collection agency along with its employees. The debt collector returns all files associated with your organisation and destroys all info related to your organisation from their data storage.
You are likely to pass delicate details to the collection agency such as your account receivables, customer contacts, item and services rates, etc. to help with faster debt collection. Setting up procedures is a very important action in dealing with the collection agency. The collection agency may utilize one or more of its involved agencies to get info about defaulting consumers. In debt collection practices, the timing of communication is incredibly essential and for this reason it will go a Zenith Financial Network 888-591-3861 long way in deciding the success of your debt collection procedure. If it does not, then you need to transfer all your debt collection processes from the agency.
