Top 10 Questions to Ask a Debt Collection Agency
Top 10 Questions to Ask a Debt Collection Agency
As with any other service, your business is considering the use of, it is important to perform thorough research beforehand.
More and more UK businesses are opting to use a debt collection agency for their credit control requirements. Doing this is becoming the norm, as an agency will provide an effective and low-cost solution.
As with anything, there are a great number of options available when you choose to hire a debt collection agency. With this in mind, it is often difficult to know which option to choose with so many to pick from.
Asking the right questions can help you to find the best agency for your case.
1. Where can you collect debts from?
Before committing to any debt collector, you should first clarify where they can operate. Many debt collection agencies may provide a specialist service based on a location. For example, in the USA, some agencies will only recover debts from a specific state.
Most debt collection agencies in the UK will be able to recover money from England, Wales and Scotland. However, if your debtor is overseas, you will need an international debt collection agency.
Federal Management provides debt recovery services across the globe. Regardless of whether your debtor is in the UK or in another country, our experts can help.
2. What kind of accreditations do you have?
Ensuring that the collection agency you will be using is accredited is extremely important. Without any accreditations, you cannot be entirely sure how the agency you are using will be operating.
Spending time researching the agency beforehand can be a great help as well, as you will be able to cross-check what they are telling you.
The best agencies will provide a fully professional service that follows the rules and guidelines of the awarding body. An example of this could be the Financial Conduct Authority (FCA) or accreditation such as ISO9001 .
3. What kinds of businesses/industry sectors can you help?
Whilst some debt collection agencies might offer business recovery services, they may not have any experience in your industry sector.
Having a working knowledge of each business sector can often be important to success. Federal Management has worked with businesses from every sector, giving us the best knowledge needed to recover any commercial debt in the UK.
4. Do you specialise in any specific type of debt?
Some debt collection agencies specialise in certain areas of enforcement and recovery. For example, many agencies are experts at recovering personal debt for private individuals.
Other agencies, like Federal Management, are known for their successes in recovering commercial debts.
Asking this question will help you to find the right agency, as choosing a specialist for your case is always preferable.
5. What is your average debt success rate?
Asking this question will help you to determine how effective the collection methods of the agency are.
An average success rate of 90% or above is considered positive, as this means the vast majority of cases are won successfully.
Federal Management’s average recovery rate is 90% and above on all undisputed business debts.
6. How much does hiring a collection agency cost?
Whilst the cost of instructing an agency is usually dramatically lower than alternative options, it is something you should factor into your decision making.
Different businesses will operate on different price models, which dictate how much collection agencies charge. Some operate on a commission basis, whereas others request you pay a monthly fee.
It is always better to find out all of the costs before proceeding.
7. Will the process affect our relationship with the client?
You should always ask for specifics on how the agency you are talking to will manage the debt. If they pursue the debt without regard for your relationship with the client, it may compromise an otherwise healthy arrangement.
Seeking out an agency that will preserve and enhance your client’s standing with you is the best outcome. This is one of the best reasons to use a good debt collection agency.
8. Has your agency got a proven history of debt recovery?
Asking for examples or case studies of any successful recovery cases can be very useful. It can help you to understand what the process used is, as well as the results of some cases.
Looking at client testimonials from other unpaid debts can also be useful, as it provides a more objective point of view.
9. How long does it take to recover a debt?
The time taken to recover a debt often depends on the individual case. Some cases may have more complex or higher numbers of debts, whereas others may be much more straightforward.
The best way to understand the length of time required for debt collection is to speak with a professional debt collector.
10. How do I instruct your agency?
If you have asked all of the questions you need to and are happy with the answers, it is good to ask the process of instructing the agency.
This is not the same as committing to the agency – you are only asking what the next steps are.
Doing this can help you to prepare any documents that are required in advance. This can make the process go smoother when the time to move forward comes.
It is also a good opportunity of discovering what you will need to sign on to. This will help you to make a decision when the time comes.
Instructing Federal Management
Federal Management is known as the UK’s leading commercial and international debt collection agency.
If you need a fully-professional and comprehensive debt recovery solution, speak to one of our friendly debt collection agents now.