If you've just made the decision to use the services of a debt recovery agency and this is your first time, you need to be careful about who you employ. You need to make sure the agents you choose can deliver what you expect, in the timescales you need, without damaging your reputation in the process.
Be clear about what you want the agency to do
Firstly, before you contact any debt collection agencies, you need to be clear on what you expect. As this is your first time, you may not be sure what a collection agency can realistically achieve but it’s wise to begin with what you would like to see and work from there.
Investigate and compare
When searching for debt collectors, ask others you know for any recommendations. See if they’ll also give you an idea of how successful the agency was with recovering their debts as this will help you refine your own expectations. Search online too and don’t limit yourself to local agencies. Nationwide debt collection agencies often have greater resources and may have additional insight into where your debtor may have gone if they have left your area.
Established, Licensed and Experienced
Look for agencies that have been established for many years and check if they are members of the CSA (Credit Services Association) which is the industry professional body and will ensure the agency work to the highest possible ethical standards. Also above all, check they hold a valid license to carry out debt collection services you can check this with the OFT (will be known as the FCA as of April 2014)
You may decide to work with a B2B (Business to Business) or B2C (Business to Consumer) specialist agency (although most agencies will offer both), or an agency with experience in your business sector. There are benefits to working with an agency that understands your industry as they may have contacts and appreciation for how businesses operate, however a broader agency can bring fresh thinking to tracking down difficult-to-find debtors.
12 questions to ask your agency
When you have created a shortlist of agencies, you will need to speak to them to get a good idea of their working practices. To help you compare each agency equally, here are 12 questions to give to each agent that will help you make the right decision:
- How long have you been in business?
- Do you specialise in B2B or B2C debt collection?
- Do you have experience in specific industries or areas of debt collection?
- Are you a nationwide recovery agency or local only?
- Do you chase debts that exist outside the UK and if so, where?
- What is your fee/remittance structure?
- What are your working practises and do you offer regular reporting?
- Do you have an in-house tracing team?
- Do you offer any guarantees or service standards?
- What results can I expect?
- Why should we use your agency?
- Are you prepared to provide references and Terms & Conditions?
If you would like to know more about using a debt collection agency for the first time, visit www.pjcds.co.uk.