It is inconvenient for any company when customers pay late, but even more troublesome when debtors do not pay at all. In such cases, it is often necessary, after sending payment reminders and warnings, to engage a debt collection agency. They then take on the responsibility of recovering the debt from the debtor.
Business Debt Collection Agencies
A debt collection agency is a company that attempts to collect a debt from a debtor on behalf of your company. However, these companies are bound by certain rules when collecting outstanding invoices. In practice, this means that debt collection agencies request debtors in writing to proceed with the payment of the outstanding invoice. Such a company is not allowed to take coercive measures and is therefore limited in that respect. If payment is still not made, the next step is to engage a bailiff’s office to initiate legal proceedings.
Choosing a Debt Collection Agency
When hiring a debt collection agency, it is important not to go with the first one you come across. You are essentially handing over your debtor management and thus your customers to a debt collection agency. Always ask for experiences, because debtor management is quite delicate work and can damage the company’s image.
The Friendly Alternative to Debt Collection Agencies
Of course, it is best to maintain the customer relationship, and there is an attractive alternative to hiring a debt collection agency in this regard. Payt offers a seamless follow-up in the form of an amicable collection process after the automatic reminder process to get your invoices paid. You do not hand over your debtor management, but retain control over the process. In this process, collection costs are charged to the customer, and communication is made – for the first time – from the Ipsum Incasso brand. This way, the file remains complete, including all correspondence exchanged since the first invoice. The collection costs charged to your customer are received directly into your own account. To maintain the customer relationship, you could even choose not to charge these if the customer pays the principal amount. You remain in control and you decide. You no longer need a debt collection agency.
Debtor management software ensures that your company easily contacts debtors, reducing the number of defaulters. In most situations, you no longer need a debt collection agency because your customers pay more often on time through smart debtor management. This also has the advantage of better maintaining the relationship with customers. Moreover, you not only save time with smart debtor management but also money. Additionally, this way, the cash flow gets a boost.
If your customer still does not respond to the reminders, Payt follows up with an amicable collection process. If there is still no response, you can automatically forward your collection cases to a bailiff or lawyer via Payt.
