How to Choose a Good Collection Agency
Posted: Dec 21, 2017
Every business faces customers that fail to make their due payments and that can have a big impact on the business’ cash flow and financial health. Unfortunately, collecting money from defaulting customers isn’t easy and business owners are forced to spend valuable time calling, contacting, and visiting the customer’s property in order to get payments. This can be a significant burden on all business owners, especially small to midsize business owners who need to focus on running their business with limited assistance and finances.
Hiring the best collection agency in your local area can help you get the payments due without wasting too much time on it. You can focus on your business while the collection agency handles the rest. Here are some tips on how to hire the best collection agency for your requirements:
- Consider the agency’s reputation
All debt collection agencies need to follow fair practices and make sure the collectors don’t threaten, intimidate, or cause undue stress to debtors. It’s a good idea to check local reviews or visit the Better Business Bureau website and see if there are any complaints against the business. Debt collection is a serious matter that should be handled carefully. An agency with a well-established and good reputation will do a much better job than other companies with harsher tactics.
- Licensed and bonded
Always hire an agency with the right licenses and bonds. Some states only require a license while others will require both licenses and bonds. You should find information about the license and bond on the agency’s website or can speak with the agency directly to get more information. It’s also a good idea to find out if the agency is licensed at the state level or national level. If your business is local, state level licensed agencies will work well. If you operate on a national level or have clients in different states, you need an agency with national license or licenses in the relevant states.
Check to see of the agency has Errors and Omissions Liability insurance because that’s a sign of a reliable and trustworthy collection agency. This isn’t required by state or national laws, but can prove to be very beneficial if the debtor accuses the collectors of improper conduct or slander.
Don’t let the size of the agency deter you from hiring them. A good agency will be effective and provide good results even if they’re small and have a limited area of influence. It’s also a good idea to visit the agency in person and speak with the employees before you hire them. Ask questions regarding the percentage of debt they’ve collected and see what techniques they use to collect it.
These tips will help you find the best collection agency and help reduce the burden on your shoulders. Discuss your requirements with the agency and make sure your reputation isn’t harmed during the collection process. The right agency will use persuasive but respectful collection techniques to get the best results.
The author is an expert in financial and debt collection services. He wants to share his knowledge through this article on how to recover payment from debtors and maintain good relation.