debt management

5 Reasons to Hire Professional Debt Collection Agencies

Every business goes through a period during which owner has to deal with outstanding account receivables that must be collected to keep it running. When this happens, one in two common approaches may be adopted to collect those receivables.

•    In-house Approach: The simple and traditional approach is to collect delinquent debt by means of in-house operations. Although, in-house approach is productive and more likely to be your first choice, your company may not have the time and resources to pursue it effectively. 

•    Professional Approach: Another approach is to opt for professional debt collection service equipped with all the tools and techniques to handle this tedious task. This approach is much better when dealing with debts older than 6 months, or the ones with the least chances of recovery.

There are plenty of reasons why you should choose professional debt collector singapore to recover your delinquent account receivables: 

1.    Specialization

If you had the capability, you wouldn’t have been dealing with unpaid debts. So, you need specialists to accomplish the task. As a third party, outsourced services understand the sensitivity of the matter and they look at it with a different perspective. Debt collectors specialize in assessing customers’ records, their financial stability and ability to pay debt. Moreover, they know how to communicate the problem and create a win-win solution. 

2.    Effectiveness

Tracking down delinquent customers isn’t always easy. Most of the time, it is more time-consuming than getting back the amount. Professional debt recovery service can save your time and expenses in finding those customers and employing resources to recover what is owed. 

3.    In-depth Tracking

Don’t think that the term “tracking down customers” only refers to the in-hand information you have. For customers who must have changed their contact information and address can be tracked down using latest software, social media, credit card transactions and more.

4.    Positive Attitude

Even if you succeed to track your customers, what are the chances that you get your money back? Naturally, as a creditor or an unpaid seller, you may become impolite in compelling your customers to get back your rightful amount. Your customers may get confused, or sue you for harassment. 

A professional debt collector knows how to compel delinquent consumers to re-pay their debts, through legitimate ways:

•    By means of negotiation – dividing the sum into weekly, monthly or quarterly installments
•    By tracking down their financial condition and encouraging them to clear their dues
•    By informing them how this non-payment may affect their future credit scores
•    By sending them legal notices and forcing them to pay back their debts

5.    Keeping Customers Satisfied

In dealing with your delinquent customers, you always have a risk of losing them. In this scenario, the best you can do is, hire a professional debt collection service that promises to deliver results without turning your customers away. Today, when businesses are focused on customer loyalty, these services help them by working side by side focusing on outstanding account receivables. They create result-oriented strategies that not only benefit original creditors, but also put less burden on customers.

Conclusion

Risk management has become a key contributor in determining organization’s success and hence, debt recovery services are getting increasingly important for modern-day businesses. They help businesses minimize the risk of losing money and customers through effective strategies. 

How to Pay Off Your Debt in 9 Simple Ways

 

Are you worried because a debt collector has just reminded you to clear your dues before a certain date, and you have no idea how you’re going to pay it off? You’re not the only one dealing with this problem. In fact, the majority of debtors don’t know how much they’re supposed to repay. Anyhow, you have to be vigilant because delinquent debts may affect your credit scores anytime. 

So, if you’re looking for ways to repay your debts, here are 9 possible ways do it:

1.    Budgeting
This may seem like an “old-school solution” to you, but it’s the best and probably the easiest way to monitor your financial position. There are plenty of financial tools to create an income/expense sheet that can help you cut down expenses and pay your dues. 

2.    Concentrate on the Most Expensive Debt
If you have more than one creditor, arrange the interest rates in descending order (from highest to lowest).  According to experts, clearing high-interest debts always help to maintain a high credit score. Moreover, debt recovery services will also advise you to repay the debts with high interest.  

3.    Impact of Paying More than Minimum Balance
Try to pay more than what you're supposed to pay on monthly basis. If you stick with the minimum balance, it will only prolong the debt payoffs. You can make weekly payments, or double the number of monthly payments. In this way, you'll show strong commitment of paying everything off.

4.    Balance Transfers
Here's another strategy to reduce the burden. If you're confident to pay back the balance with high-interest rate, in two or three months, you can transfer the debt to a credit card that doesn't charge anything (zero-interest) on balance transfers. Make sure, the balance must be paid before expiration; otherwise, you'll end up getting the much higher rate.

5.    Stop Credit Card Spending
This is yet another old-school trick, but it always works. You can halt the spending via credit card and prevent debt accumulation. It’s quite hard to leave your credit card at home, especially when you can earn reward points and cash backs. But controlling your finance is more crucial right now.

6.    Allocate Monetary Incentives toward Debt
Think about the bonus you’re going to get next month. You can utilize it to pay back your debts. If you have a debt payoff plan, allocate your extra earnings toward minimizing your debt burden. So, cancel any plans for vacations this year, because, you’ll get more satisfaction when your debts are paid off.

7.    Don’t Forget to Remove Credit Card Information Online
Online shoppers often tend to store their credit card information on e-commerce stores, just to save few minutes. The bad side of this practice is, you may be charged for the things you don’t really want. Instead, use debit cards to pay for recurring services. 

8.    Sell Things You Don’t Want
Surely, there will be plenty of unwanted things in your house, and you can sell them online. In this way, you can earn quick money and repay your bills.

9.    Change Your Lifestyle
Other than emergency situations, people often become indebted because of their lifestyles. So, before you get a call from debt collection agency, think about your routine and see where you can cut down your expenses.

 

Accounts Receivable Management Tips for Small Business

One common strategy many small business owners use to beat the competition is extending credit to their customers. For instance, some companies allow their customers to delay payments for the products or services already provided. This customer retention strategy, however, is not without risks. Improper management of accounts receivables may result in cash flow problems. If your business has thousands of dollars in delinquent accounts, something is wrong with your receivable management policy. Hiring a debt collector for the job would be a good idea, but there are certain things you can do on your own to better manage your accounts receivables. 


Tips on How to Better Manage Your Accounts Receivables


•    Develop a credit policy – Your business should have a well-thought-out credit policy in place. Make sure your credit policy clearly states who to extend credit to, and terms and conditions for extending credit. Consider creating a customer credit application form and get it filled by every customer who you extend credit to. That way, you will have all the necessary details about your customers, including their names, addresses, bank references, credit history, and income sources. Your credit policy should also have detailed instructions about how to deal with late-paying customers and what actions should be taken if a customer refuses to pay. 


•    Create and send out invoices on time – One way to improve your chances of getting timely payments from customers is by sending them detailed invoices on time. Make sure you provide all the necessary information on your invoice, so that your client can approve and process your payment quickly. For instance, your invoice should include your contact details, date of the invoice, details of the products or services provided, unique referenced ID, payment terms, and due date. Try to avoid vagueness as much as possible. For instance, “$5 will be charged on all payments after due date,” is more specific than “penalties will be charged for late payments.”  


•    Start following up early – It is always a good idea to send remainder a few days before the due date rather than waiting for an invoice to become past due. Start following up early, but make sure you don’t offend the customer. If the invoice is already past due, you can send an email asking whether they have received the invoice or have any questions about it. 


•    Continue sending reminders – Not getting timely payment from clients is a common scenario, so you should be prepared for this. Simply start by continuing to send reminders to the client who has not paid on time. Try to get a written confirmation from the client and ask for a specific payment date. Keep a record of his responses for future reference.


If a payment is due for more than 90 days despite several reminders, perhaps it is time to seek professional help. Make sure you choose a collection agency that has years of experience in providing receivables management services. The goal here is to collect your accounts receivables without hampering your customer relationship.  

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