Before you commit to using a debt collection agency, there are a few things to consider. It’s not just about ensuring you have the best chance of getting a positive outcome. It’s also about finding a company that’s cost-effective, easy to work with and reputable.
Here are some important questions to ask yourself…
Are they properly regulated and compliant?
Checking out a company’s credentials is a simple way to whittle down the list. First and foremost, you should check if they’re regulated by the Financial Conduct Authority (FCA). If they are, they’ll follow best practice and adhere to rigorous standards of service.
It’s also worth making sure they’re properly GDPR-registered and have a robust privacy and data management policy. Remember, you’ll be providing them with sensitive information, so you need to be sure they’re handling that data safely and appropriately.
And don’t forget about insurance. Do they carry an appropriate level of third-party liability and professional indemnity cover?
Do they have a good track record?
How long has the debt collection agency been in business? If they’ve been trading for a long time, there’s a good chance they’re relatively successful at what they do.
You can also tell a lot about them by their current and previous customers. What kind of businesses do they work with? Are there any big names? Looking at case studies or testimonials can offer an insight into the way they work.
Don’t just rely on the debt collection agency’s own website. Check Google for reviews, and to see if they’ve made the news or are mentioned in other independent sources.
Are they easy and cost-effective to work with?
Not all debt collection agencies are created equal. For example, some may charge up-front fees rather than working on a commission-only basis. This gives them much more of an incentive to achieve a positive result. They may also have a long-winded and complicated onboarding process, which could delay things unnecessarily.
The whole point of using a debt collection agency is to recover the debt as quickly as possible, without extra cost and time commitment on your part. That means finding a company that’s easy and cost-effective to work with, provides an attentive, personalised service via a dedicated account manager, and keeps you regularly updated.
Do they provide a comprehensive service?
You might need more help than simply chasing an overdue debt. A good debt collection agency will offer a range of other services, from proactive debt management to support with taking legal action.
Is your good name safe in their hands?
Debt collection is a sensitive area and perceived strong-arm tactics or unethical practices can reflect badly on your business. That’s why it’s vital to find a debt collection agency that’s committed to working with tact and probity to the letter of the law. It’s about being firm but fair, and always being aware of debtor vulnerability concerns.
Do they understand your industry?
The principles of debt collection may be universal, but there are often industry-specific considerations to take into account. For example, retentions can complicate matters in the construction sector. That’s why it’s important to be sure that your debt collection agency has a good understanding of how your business sector operates. Do they have experience of working with similar companies? Do they engage with your industry sector via trade associations and events?
Do they have the right technology?
In today’s super-connected world, technology can deliver excellent results in debt collection. A good debt collection agency will have access to a wide range of tracing resources, including government registers and credit file address searches. They’ll also be able to make use of all communications channels: from letters and telephone follow-up, to email and SMS.
When can they start?
Overdue debts are not only frustrating, they can also impact on the financial stability of your business. With no time to lose in chasing and recovering a debt, there’s one final question to ask yourself: can the debt collection agency start working for you today?
The answer to all your questions
At Redwood Collections, we tick all the boxes when it comes to effective, professional debt collection services. With a simple, commission-only fee structure, a well-established reputation, professional integrity and technical know-how, we can deliver excellent results quickly and cost-effectively. Trust us to help your business Grow Stronger.
