Role of debt collection agencies

1. 1 Role of Debt Collection Agencies Debtors are usually scared of such debt collection agencies as they knowing the powers and authority assigned to such companies. There are some unscrupulous agencies in the market that makes debtors believe, that they possess powers Debt collectors are not authorised to enter your premises or take possession of the belongings but they can only demand money from you. They just keep calling the debtor’s time again and keep reminding them about the debt but on the other hand, there are some unprofessional collectors as well, who threatens the debtors with the intention of recovering the dues in short span of time. Debt collectors aren’t supposed to call the debtors at awkward times or repeatedly, like too early in the morning or too late in the evenings. They have to adhere to some professional work ethics and follow legitimate practices. Resources: -http://www.sooperarticles.com/business-articles/professional-services- articles/role-debt-collection-agencies-1654091.html

2. 2 The Role of Debt Collection Companies Many companies hire debt collection agency for the collection of their bad debts. Bigger companies have their own in-house debt collection department or branches for this purpose but there are many medium and small-scale companies that can’t afford to have such departments. Therefore, in this case, they prefer to hire debt collection services. Debtors are usually scared of such debt collection agencies as they know the powers and authority assigned to such companies. There some unscrupulous agencies in the market that makes the debtors believe that they possess powers than they actually have and in such situation, the state of affair remains unresolved. Retaining existing customers is a key factor in the success and longevity of every business. Playing the role of 'bad cop' in debt recovery from existing customers is not a function that most companies look forward to as it can have adverse impacts on them. Therefore, using a third-party service to send notices for debt recovery usually helps the person or company owing the money to get into action without seriously affecting the relationship with the company. In business, the unwritten policy is to prolong bill payments for as long as possible to allow better cash flows. In some cases, unless a collection agency intervenes to demand payment, checks or outstanding amounts not released against invoices.

3. 3 Debt collections agencies can paid in two ways, first way is to pay debt collectora fixed amount and the other way is to pay them a percentage of the total debt collected. There are some agencies that straightaway buy a debtor, it means if a debtor was supposed to pay an amount to a company, once the agency buys them, the debtor will have to pay the amount to the agency then. By doing so, the company gets some percentage of the total debt. The company gets some percentage of total debt by selling a debtor to an agency. The amount collected by the agency retained to the collector itself. Since the agency always strives to collect more funds than what paid to the company, it uses all kind of tactics, strategy and often indulges in unwarranted practices. Many a times a sales team in companies that owed amounts by clients are sometimes not paid their commissions or incentives. This might force sales people to spend a great deal of time working to recover the money rather than doing actual sales calls or sales generation for future revenues. In this case, debt collectors might be helpful. By paying a collection agency a fixed salary for collecting debts, companies save a lot of money, time and effort to collect dues, effectively. In addition, by using a commercial collection agency, the bank can expect to recover amounts early, retain customer relationships and creditworthiness as well as ensure that their financial books keep a healthy status.

4. 4 Debt collectors are not authorize to enter your premises or take possession of the belongings but they can only demand money from you. They just keep calling the debtor’s time; again and keep reminding them about the debt but on the other-hand there are some unprofessional collectors as well, who threatens the debtors with the intention of recovering the dues in short span of time. A professional and experienced debt collector Melbournewill always try to maintain healthy and helpful relations with their debtors and provide all kind of assistance, when required. They often start the process of negotiation for recovering the debts, which also eases the burden of debtor. The debt collectors aren’t supposed to call the debtors at awkward times or repeatedly, like too early in the morning or too late in the evenings. They have to adhere to some professional work ethics and follow legitimate practices. They can call a debtor in daytime or work place if it is allow by the company but if not then they should stop calling you, once you inform the debt collector about the same. A debt collector in any condition is not permit to threaten or harm you in any manner or even use abusive language nor do they can any kind of bogus claims about your debts. A debt collector must clearly communicate about their legal rights or official ranks and not make false claims to take away your assets or getting you arrested. A good debt collector will always adhere to some standard norms and by doing so; they build a positive market value. Resources: -http://www.sooperarticles.com/business-articles/professional-services- articles/role-debt-collection-agencies-1654091.html