How to deal with a collection agency

Phase I - Selection of a collection agency to

Selecting a credit collection agency is perhaps the most important and difficult task. Some factors to consider when selecting a collection agency are:

- Experience and professionals

- Geographic presence

- Competition

- The costs and the load pattern

- References

- Agency Services has addressed this issue in depth through various free collectionsreports and articles on this site.

Phase II - Making the Agency to collect and process configuration

Once you select a collection agency, the first two steps are:

Contract with the agency;

Set how the processes will communicate with the agency.

A contract is a legal document and legal experts, of course, is properly prepared. Just make sure you include important clauses such asnondisclosure. Is likely to pass information to the collection agency, such as accounts, contacts with customers, products and services prices, etc., to facilitate the recovery of debts. You want to be sure this information does not fall into the hands wrong.

The creation process is an important step in the treatment of the collection agency. The success or failure of the alliance will depend largely on howand how well-defined processes are followed strictly. Important processes to be defined are:

Internal processes: You have to put in place a clear process to define the default and remanded the case to the collection agency. Do not you want to refer the case to the collection agency before making a sincere effort to let in house.

Information transfer: How I can transfer the information to the collection agencyon your taxes and delinquent customers, and how to receive information from your collection agency? Debt collection software can make the process of transferring information easily and securely.

Part III: As mentioned earlier, it's important for you to ensure the security of the information given to the collection agency. The collection agency may use one or more of its member agencies for information on defaulterscustomers. Therefore you must establish a clear protocol on how much information you can share with these parties.

Warning: You must establish a single point contacts for communication within the company and the collection agency debt collection practices, the timing of communication is very important and therefore go a long way to decide success. the process of debt collection. Once again, the importance of debtcollection software can not be underestimated here.

Phase III - Performance Monitoring

Once all processes are set, start monitoring the performance of the collection agency. This is an ongoing process when dealing with a collection agency. The most important parameters to control are:

Quantitative

- Number of cases referred to the collection agency and the percentage of cases successfully solved by them.

- Percentage of debtrecovered by the collection of all cases.

- Percentage of debt recovered by the collection agency from solved cases.

- Percentage of the amount paid as fees / commission for the collection agency for the total delinquency cases referred to them.

- Average number of days required for the collection agency to collect the total credit / partial.

Qualitative

* The capacity of the collection agencyprofessionals according to your customers?

* Has the collection agency followed all legal requirements in the Fair Debt Collection Practices Act?

* Has the collection agency gone beyond the provisions of the Fair Debt Collection Practices Act?

* Has the collection agency followed all processes and guidelines for you?

Phase IV - ContractClosing

Hopefully the collection agency selected will work best for you. But if not, then you need to transfer all the debt collection process by the agency. You must remember the following important points at the end of the contract:

Confidentiality clauses and non-disclosure apply even after the end of the contract with the collection agency and its employees. The collection agency returns all documentsrelated to your business and destroys all information related to your business of data storage.

Following these simple guidelines will ensure that when it comes to a collection agency that works best for you and your arrears are kept to a minimum.