The pros of using a debt collection agency
Unfortunately, not all customers are reliable when it comes to paying their invoices on time for your products or services and the longer the outstanding debt is left unpaid, the more difficult it becomes to collect the money owed. Appointing a third-party debt collection agency to recover the debt from your customers or clients has many benefits, you can read them for yourselves here:
- Recovering the debt is more successful
Your odds of recovering outstanding payments from clients are much higher when you appoint a debt collection agency compared to handling the debt recovery process yourself. While your primary focus is on running your business and generating leads, the primary focus for a debt collection agency is on recovering debt – it’s their job! They are trained professionals with plenty of experience in this field and know and use the best practices and techniques to successfully retrieve late payments.
- Receive your outstanding payments quicker
Recovery of debt is notably much quicker when using a collection agency as they have experience in dealing with difficult debtors and can be firm and persistent until the money is received. They also often have the ability to report any unpaid debts to the credit bureaus, which can negatively affect a debtor’s credit scores for up to seven years. This can sometimes result in the debtor negotiating with the collectors to make a payment arrangement to avoid any credit damage and therefore you are also likely to receive your money sooner.
- It will decrease the amount of debt cases and improve cash flow
Partnering with a debt collection agency to handle your debts throughout the year and sending out a clear message to your clients that no late payments or bad debts will be tolerated is sometimes all you need to prompt your clients to pay on time. You can be assured that the debt collection agency will do their upright most to retrieve any payments that are overdue before things escalate and it has a negative impact on your business’ cash flow.
- Spend more time focusing on your business
You will no longer need to spend your valuable time chasing the debtors for their overdue payments and can focus on running your business instead. A debt collection agency will handle all of the comms with the debtor on your behalf, meaning you don’t need to waste your time having frequent and uncomfortable phone conversations or writing pressing letters in the effort to recover the debt.
- Legal protection for you and your business
A debt collection agency has plenty of experience in collecting debts whilst ensuring that they do not violate any of the debtors rights, whereas a business owner of an SME might take a different and less conventional approach in an attempt to recover the debt. Debt collectors are fully-informed of the legal situation regarding bad debts, therefore; by hiring a third-party collection agency to recover the unpaid debts on your behalf reduces the legal risks involved with pursuing the debt yourself. You’re also far less likely to damage your reputation as a business by putting the matter into a debt collecting professional’s hands.
If you’re a business owner or self-employed and think you could benefit from a debt collection agency to recover any overdue payments, DebtCase is a free online service which connects you to vetted businesses that can help you successfully recover outstanding balances. To find out more, contact us today.
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