Picking a credit collection agency is perhaps the most essential and challenging job. Some aspects you must consider while choosing a debt collector are:
- Experience and specialists
- Geographical presence
- Proficiency
- Charges and charging design
- Consumer referrals
- Collection Agency Services has covered this topic in depth through different totally free collections reports and posts on this website.
Action II - Working With the Collection Agency and Setting Up Processes
Once you select the debt 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 interact with the agency.
An agreement is the legal file and your legal experts will, obviously, prepare it properly. Simply make certain that you consist of crucial stipulations such as privacy and non-disclosure. You are most likely to pass delicate details to the collection agency such as your receivable, consumer contacts, product or services rates, and so on to help with faster debt collection. You wish to make sure that this info does not fall in the wrong hands.
Setting up processes is a very important step in dealing with the debt collector. The success or failure of your collaboration will depend a lot on how distinct your procedures are and how strictly they are followed. Essential processes you need to specify are:
Internal procedures: You need to put in place a clear process on defining bad debt and referring the case to the debt collector. You do not wish 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.
3rd party dealing: As discussed earlier, it is very important for you to make sure the security of the details you offer to the collection agency. The collection agency might utilize one or more of its involved companies to get information about defaulting consumers. Thus you need to establish a clear procedure on how much information they can show such third parties.
Communication: You need to establish single point contacts for communication within the collection and the business agency. In debt collection practices, the timing of communication is extremely crucial and thus it will go a long way in choosing the success of your debt collection process. Once again, the significance of debt collection software can not be overstated here.
Step III - Performance Tracking
Once all procedures are set, start monitoring the efficiency of the debt collection agency. When dealing with a collection agency, this is a continuous process. Crucial specifications to monitor are:
Quantitative
- Variety of cases referred to the credit debt collection agency and percentage of cases effectively solved by them.
- Portion of debt recovered by the debt collector from all cases referred.
- Percentage of debt Zenith Financial Network Inc recuperated by the debt collection agency from solved cases.
- Portion of amount 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 deal with your consumers?
* Has the debt collection agency followed all legal requirements pointed out in the Fair Debt Collection Practices Act?
* Has the debt collection agency surpassed the provisions of the Fair Debt Collection Practices Act?
* Has the debt collector followed all processes and standards set by you?
Action IV - Contract Closure
Ideally, the selected debt collection agency will work best for you. If it does not, then you need to move all your debt collection processes from the agency. You must keep in mind the following important points when you are ending the agreement:
Confidentiality and non-disclosure provisions apply even after the end of the agreement with the collection agency in addition to its staff members. The collection agency returns all files connected to your company and damages all information related to your company from their information storage.
You are most likely to pass sensitive info to the collection agency such as your account receivables, consumer contacts, product and services prices, and so on to facilitate faster debt collection. Setting up processes is an extremely crucial step in dealing with the collection agency. The collection agency may utilize one or more of its involved agencies to get info about defaulting clients. In debt collection practices, the timing of interaction is extremely essential and for this reason it will go a long method in deciding the success of your debt collection process. If it does not, then you require to transfer all your debt collection processes from the agency.
