Step I - Choosing A Debt Collection Agency
Picking a credit collection agency is possibly the most crucial and hard task. Some elements you need to think about while selecting a collection agency are:
- Experience and experts
- Geographical existence
- Charges and charging design
- Consumer referrals
- Debt Collector Services has covered this topic in depth through various totally free collections reports and short articles on this website.
Action II - Working With 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.
A contract is the legal document and your legal experts will, of course, prepare it correctly. Just make sure that you include important clauses such as confidentiality and non-disclosure. You are likely to pass sensitive information to the collection agency such as your account receivables, customer contacts, product and services pricing, etc. to facilitate faster debt collection. You want to be sure that this information does not fall in the incorrect hands.
Establishing procedures is a crucial step in handling the debt collector. The success or failure of your partnership will depend a lot on how distinct your processes are and how strictly they are followed. Important procedures you have to define are:
Internal processes: You have to put in place a clear process on specifying uncollectable bill and referring the case to the debt collection agency. You don't want to refer the case to the collection agency before you make a genuine effort to gather the fees internally.
Info transfer: How will you transfer the information to the debt collector about your charges and defaulting clients, and how will you receive the information from your collection agency? Debt collection software application can make the info transfer process easy and protected.
3rd party dealing: As discussed earlier, it is very important for you to ensure the security of the details you offer to the debt collection agency. The collection agency might utilize one or more of its associated firms to obtain info about defaulting customers. You require to set up a clear protocol on how much details they can share with such 3rd parties.
Communication: You have to set up single point contacts for communication within the business and the collection agency. In debt collection practices, the timing of communication is exceptionally essential and hence it will go a long way in choosing the success of your debt collection procedure. Again, the value of debt collection software can not be overemphasized here.
Action III - Performance Tracking
When all processes are set, begin keeping track of the performance of the debt collector. When dealing with a collection agency, this is an ongoing procedure. Important parameters to keep track of are:
- Number of cases described the credit collection agency and portion of cases successfully resolved by them.
- Portion of debt recovered by the debt collection agency from all cases referred.
- Portion of debt recuperated by the debt collector from solved cases.
- Portion of quantity paid as fees/commission to the collection agency to the total uncollectable bill cases described them.
- Typical number of days taken by the debt collection agency for full/partial credit collection.
* How well do the collection agency specialists deal with your customers?
* Has the debt collector followed all legal requirements pointed out in the Fair Debt Collection Practices Act?
* Has the collection agency gone beyond the arrangements of the Fair Debt Collection Practices Act?
* Has the collection agency followed all standards and processes set by you?
Action IV - Agreement Closure
Hopefully, the Zenith Financial Network 888-591-3861 chosen collection agency will work best for you. However if it doesn't, then you have to move all your debt collection processes from the agency. You ought to keep in mind the following important points when you are ending the contract:
Privacy and non-disclosure clauses apply after the end of the agreement with the debt collector as well as its staff members. The collection agency returns all documents connected to your business and ruins all details related to your business from their data storage.
You are most likely to pass delicate information to the collection agency such as your account receivables, client contacts, item and services rates, etc. to help with faster debt collection. Setting up procedures is a really important step in dealing with the collection agency. The collection agency might utilize one or more of its associated companies to get details about defaulting customers. In debt collection practices, the timing of communication is very crucial and hence it will go a long way in choosing the success of your debt collection procedure. If it doesn't, then you need to transfer all your debt collection procedures from the agency.