Are you a creditor business considering how to outsource debt collection?
Well, you’ve come to the right place! Outsourcing, when done with the appropriate knowledge, can be really beneficial to your business and your collection technique.
It is, however, important to take into account the specifics of your matter and choose the road that’s right for you.
In this article our debt collectors will explain why you should outsource debt collection to a debt collection agency.
What is Outsourcing?
In debt collection, outsourcing is the process of handing over control of recovery of debt to a professional, generally a debt collection agency.
A creditor may choose to outsource their debts for a variety of reasons.
Debt collection can be a difficult task to navigate, and a professional will be knowledgeable on the matter and likely have dealt with various similar collections in the past.
As a creditor, you also may find yourself unaware of the laws or regulations on debt collection and fearful that you may violate one of these if you pursue the debt on your own.
A debt collection agency is a great way to ensure efficient, effective, and, most importantly, the legal collection is taking place so that you receive the best result possible from the matter. It is important, however, to ensure you are employing a reputable agency and that you do your research on it, as unlawful debt collection by an agency will be the responsibility of the creditor.
The Debt Collection Guidelines: for Creditors and Collectors state the laws of debt collection in Australia.
Why Should I Outsource Debt Collection?
There are a number of good reasons that you should outsource debt collection to professionals. Those reasons include:
- Improves collection times
- May save you money
- Professionals have the tools
- Opens up your time
- Helps with difficult clients
We will explain these in more detail below.
Outsource Debt Collection for Improved Collection Times
An amazing benefit that can come with the investment in a debt collection agency to recover outstanding debts is the decreased time in which they can do so!
As professionals in the industry, they will likely have both the experience and the tools required to collect your debts in a manner that ensures you will receive the payment in the least time possible.
They will likely have the appropriate means and knowledge to both locate and communicate with your debtors, meaning previous time delays due to communication issues will be an issue of the past.
This will prevent you from wasting your valuable time, time that could be spent improving your business, on the tedious tasks aforementioned.
Outsourcing May Save Money
Although it may sound like the opposite, utilising the services offered by a debt collector may save you significant costs down the road.
For starters, a majority of debt collection agencies offer a “no collection, no fee” model, meaning that if they are unsuccessful in recovering your debts from your clients no charge will be necessary for the service.
This is a great opportunity, as simply following up on debts using your own time and resources will likely cost you money and if unsuccessful said the money will be wasted.
Furthermore, it is wise to focus more on the bigger picture, so to speak, than the money spent, as a debt collector will likely have a higher success rate.
This means that your investment in their service is more likely to provide you with recovery from clients, as opposed to your personal efforts.
A majority of agencies will also offer a commission, meaning that they will take a set portion of the debt they recover.
This model can provide you with the peace of mind in knowing that your payment to the agency will not be more than the funds recovered.
Professionals Debt Collectors have the Tools
A debt collection agency is a professional body in the business of debt collection, so will likely be equipped with the appropriate means to ensure your debt is properly recovered.
They will likely also have been in business for an extended period of time, meaning they will have dealt with a variety of debtors and will have both the experience and the knowledge to deal with your particular clientele, no matter how stubborn they are!
A good agency will be equipped with the tools and software one may need to collect a debt from any client.
Quick tip, make sure you research the agency you are considering employing before signing anything to ensure they have up-to-date, effective equipment to collect your debts in the manner you desire.
They will also likely have the ability to initiate legal action against the debtor if they continue to refuse or ignore payments, saving you the efforts of researching and launching action in a court environment.
Outsource Debt Collection to Open up your Time
As a creditor, you have likely found yourself taking up all of your time pursuing difficult debtors that simply will not pay.
Well, how would you like to say goodbye to this bothersome task? With a debt collection agency, you can do just that!
A debt collector, as the title implies, will take on a vast majority of your responsibilities as a functioning creditor and free up a lot of your time for either business or pleasure.
The time saved on recovery of debts may allow you to invest more hours into the growth and development of your business, or other responsibilities or tasks that you’ve been putting off.
Some extra time on your hands will really boost your company’s general productivity. Finally, as we are aware, time is money and extra money never hurt anyone!
Outsource Debt Collection to Help with Difficult Clients
Getting a client to pay their debts to you can be a really difficult task. As with a majority of the elements of debt collection, a debt collector can assist with this!
Debt collectors, as aforementioned, have the appropriate tools and past interactions to deal with even the most difficult debtors.
As businesses with a wider selection of professional tools and protocols, agencies will likely have the means to locate and recover debts from clients who will not pay on time, or at all!
The official face of an agency will also place a level of stress on your debtors, so if in the past they have not taken your debts seriously, they likely will now.
The threat to their credit score further contributes to this pressure. Furthermore, as a party not directly related to the matter, they are more likely to maintain a level-headed, professional attitude towards debtors, preventing you from tarnishing your business's reputation with any level of aggression or even violating debt collection guidelines, such as harassment!
Outsource debt collection to our expert debt collectors in Australia
Advance debt collection is an Australia-wide commercial debt collection agency and credit and accounts receivable management. We can recovery your debts, conduct skip tracing, and manage your accounts receivable. We collect your debts for commission only. This means no collection, no commission. We are professional debt collectors with combined 20 years of experience to help you collect your debts. We are partnered with expert litigation lawyers with years of experience in debt recovery, enforcement, and insolvency. Under the Agents Financial Administration Act 2014 Advance Debt Collection Pty Ltd hold authority number 4583821 to act as a debt collector. ADC Advance Debt Collection® is a registered trademark.