6 myths about debt collection

We all know that debt recovery is one of the most stressful aspects of business financial management. However, some businesses are still reluctant to call on a debt collection company. In question? The multiple preconceived ideas conveyed by press articles and the Internet which give them a negative image. We think of them as harsh, cold, aggressive, unempathetic.

Many corporate executives and finance managers worry that their clients will be harassed by a collection agency, whether it will harm their business relationships or cause legal problems. And, for the debtor, it can be frustrating if they think the debt is not owed or that they are being treated unfairly.

Let's analyze together 6 prejudices about debt collection.

1. Collection agencies would be rude and aggressive

This is one of the most common misconceptions that business owners and consumers hear. However, the best debt collection agencies understand this problem and take it into account. They are courteous and professional and recover unpaid debts without harming the relationship between the client and their debtor. Their job is to ensure that both parties are satisfied and that their relationship continues once the debts are paid.

Many people face payment issues due to unexpected expenses or other financial challenges, such as job loss or health issues. The collection agency seeks the best outcome for both parties involved. She will therefore do her best to find an amicable solution for each situation.

Collection agencies will therefore not add any stress to your life, quite the contrary. They will help you resolve the situation as quickly and efficiently as possible.

2. Debt collection agencies would be expensive

Another misconception about debt collection agencies is that they are expensive. In reality, this is far from the case. Most debt collection agencies only receive a percentage of the amount recovered, with their intervention usually covered by the amount recovered. They can save you money by supporting chargeback tracking, including sending letters to debtors and notifying them of the consequences of non-payment, sending payment plans, and collecting payments.

3. Debt collection agencies would be reserved for large companies

Collection agencies also work with VSEs and SMEs. Don't be afraid to ask questions about how they will approach your case and what they can do for your particular company. The key is to find a company that understands your situation and will work with you to develop solutions based on your needs.

4. Collection agencies could not be used for recent debts

Many people believe that debt collection agencies cannot be used for recent debts. This is simply not true! In fact, it is better to hire a debt collection agency as soon as possible. In fact, the sooner you take this step, the more likely you are to receive your money, and at a lower cost to you.

Additionally, each invoice has a statute of limitations. This means that once the invoice is sent, you have a certain period of time before your customer can raise the prescription. This deadline varies depending on the sector of activity and the country. Contact a collection agency to find out the limitation periods for your invoices and react as quickly as possible!

5. Collection agencies would damage the reputation of companies

Many creditors do not use collection agencies because they think it could harm their image. On the contrary ! Working with a collection company sends a signal of seriousness to your customers. You did work or sold something and you deserve to be paid. In addition, collection companies are required to respect sector-specific laws and certain ethics. They act in a professional and courteous manner with your customers/debtors.

6. International debt collection would be impossible

Although collecting a debt internationally can be difficult, it is not impossible. However, this requires more resources and knowledge. You must deal with a language, culture or legal system different from yours. Some collection companies have teams in different countries who have the knowledge and experience to collect your debt internationally.

To conclude, debt collection companies are there above all to help you. Entrusting them with the management of your outstanding payments is efficient and profitable. They help you improve your cash flow while respecting your customers. It is entirely possible to find a reputable debt collection agency who has solid experience in managing unpaid debts in your sector of activity.