If you are a professional or you are in charge of a company to which you owe money, you should read this article. In it we will talk about the figure of the collection company. What role does it have, why should we go to it, what is its legality, etc. It is in order for you to have a global idea about what you can do if you find yourself in a position like this. Claiming what is yours is never easy or comfortable, besides it takes time and strength. And if you’re on top of your business, it makes day after day very difficult to cope with.
In recent years these types of companies have increased their number and their cases. This is due to the high delinquency derived from the period of the crisis through which the country has passed. The changes in the way of working, the collection methods and/or the different options they offer, place the failure data above 20%.
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And you may wonder, what is the point of all this? Where are the benefits of these entities born? There are two options. Receive a percentage of the debt charged. Or buying debts from third parties whose limit has already expired, and all that is received will be for the company.
Why go to a collection company?
There are times when things do not work out the way you want, and if there is money in between, it usually becomes very uncomfortable, since you are not sure if that amount that was lent will be recovered. And it is not something that affects only individuals, but companies of different kinds. That is why at this point we will talk about the reasons for requesting services from a collection company. This action will end with many headaches.
- It’s comfortable. The professional has to save his time and strength in ensuring optimal service to his clients. So in the case of having to settle some debt, it is better that experts in the field are responsible for claiming it. Thus the entrepreneur can turn to 100 x 100 in his business, without any distractions.
- Costs are saved. When trying to collect a debt, a large sum is usually invested to obtain the desired end. And it usually becomes the largest in the balance. So this is another point in favor to hire a collection company. In the long run, it is much more profitable to delegate to these types of entities, which establish a specific action plan. And so it will be more economical, both for saving time and the forces we talked about before, as for the reduction of costs.
- You ensure the collection of an amount . Among the options offered by the collection company is to “buy” the debt. This now occupies the role of a creditor, and the professional requesting payment receives what is owed. This avoids requesting that debt over and over again. The negative point is that the recovery company sets the amount, and may not fully satisfy the other party. Since it is usually quite inferior to what was due.
- Effective . A collection company usually has a high success rate in its projects. Although this will vary in the economic time in which it is. In periods of crisis that percentage has been reduced, unable to cope with lack of funds. This has nothing to do with the so-called “delinquent professionals”, who do not pay simply because they do not want to.
Type of collection company
Next we will talk about the different categories in which we can frame a collection company according to its origin or functionality. In Spain, companies that are dedicated to claim debts are grouped in the National Association of Collection Management Entities (ANGECO). This is the employer entity of this sector, and has about fifty members. But we will talk about it in depth later.
Categories of collection entities
- Those who request debt recovery in a friendly manner . Its function is to act as emissaries of its customers. They use tools such as sending postal correspondence, telephone calls or personal visits, among other options. In order to motivate the debtor to comply with their payments. It is a measure of pressure on the debtor to avoid having to resort to justice. And the methods they use are covered by the Law.
- Telecollection companies dedicated solely to contact a list of debtors telephone. They try to convince them that they have a commitment to face, and in case of not solving it, what measures could be taken against them. The portfolio of these types of entities are debts of not very high amounts, and that are in an early stage of default. Hiring the services of this type of company comes in handy when the creditor has an extensive list of debtors. But he lacks the necessary time to call them and reach a deal. Being a more direct management, a compromise by the debtor can be reached soon.
- Law firms . The procedure of these professionals is to begin in a friendly manner with the debtor. In case you avoid your responsibilities or a deal with them, they will go through the judicial process. Even so, friendly negotiations will remain on the table in case the delinquent withdraws before the execution of a sentence.
- Large companies responsible for debt recovery. In this category the three types seen above are combined. From the least serious to resort to justice. Customer information and the case is not lost at any time, as it is a continuity in management.
Other collection entities
The vast majority of entities specialized in debt recovery only need the friendly way to reach an understanding with the debtor. A very small percentage of cases ends in a judicial phase.
If you are thinking of requiring the services of a collection company, it is good to consider those that are part of the ANGECO . Admitted in turn to the Federation of European National Collections Management Associations (FENCA). The member entities of this employer have a great guarantee of professionalism and quality. In ANGECO you have to follow strict requirements.
Even so, as we have said before, not all collection companies are associated with the National Association of Collection Management Entities . So the treatment, the professionalism and the result are not directly at odds with this. What we do recommend is to consult several, request budgets, consult your action plan, etc. And after that make the most convenient decision. This will save you from more than one problematic situation.
From Personal Blog Unpaid you can ask any questions about it. By chatting their website , contact phone number 912 668 043 or this form . In addition this portal also has a section of frequently asked questions that can help you in your decision. Later we will also talk about this collection company .
What is the National Association of Collection Management Entities?
According to the definition that appears on its web portal portal “ ANGECO is the National Association of Collection Management Entities that groups companies whose corporate purpose is to provide collection management services for unpaid amounts, both in a friendly and judicial way ”. It is also a non-profit entity. And it has a cultural and educational character.
As we said before, to be part of ANGECO, strict requirements must be met, such as the one related to the association’s code of ethics, in terms of debt collection management. To which it is necessary to add to possess a (almost) perfect professional trajectory within the business world. Associated companies are required to comply with the European level that prevails at this time in debt management.
The Federation of European National Collections Management Associations is currently part of FENCA . Among the purposes of this are:
- Protect and monitor the interests of member National Associations.
- Promote the development of the European regulation in debt collection activities.
ANGECO strategic axes
- Regulate the sector. Support public authorities to take legal measures that regulate the activity carried out by this sector.
- Networking. Help build relationships with other companies and cooperation in the sector. And thus fight together against possible common problems.
- Professional growth. Transmit related knowledge in debt collection.
- Professionalism and rules of conduct. Being part of ANGECO is like a seal of quality for its associates. This occurs in the absence of regulation by the State.
- Institutional representation. For associates to be represented in international organizations in this sector, and thus establish business relationships.
Personal Blog Unpaid
Surely you have browsed numerous times through this blog. This medium belongs to Personal Blog Unpaid . At this point you can know more about this entity, how it is born, what is its function or what is the work that develops, for example.
This collection company was born due to the need of entrepreneurs to have a reliable and updated tool with financial data on delinquency. In this way they knew more in depth the activity and the possible financial problems of other entities with which they were to close deals, and be prevented before possible defaults.
In Personal Blog the personal data of the clients is treated with total respect and confidentiality. Details such as the origin of the debt or who the creditor is are not disclosed, unless it is done at the express wish of the client in question.
How does the claim for defaults work?
- You must first create a user . You can register using your e-mail or your Facebook, Google or Linkedin accounts.
- After registering with Personal Blog , you must open a claim in the user panel. There you select the default claim modality that best relates to your case. Fill out the form below. In it you have to include the debt data.
- The debt is verified . The Personal Blog team of lawyers is responsible for reviewing the case. The maximum estimated time is 48 hours. And of course, all documents that prove the debt have to comply with legal regulations.
- Once the debt is verified, the debtor is written. You will be required by this collection company to pay the relevant debt . This friendly notification explains that if you do not agree to cancel the debt, it will become part of the Personal Blog delinquent file .
- If the debt is paid, the process is terminated. In this first phase, 58% of Personal Blog’s customers get it .
If the debt has not been paid
- In case there is no payment of the debtor, after the first requirement it will be included in the Personal Blog file . As it was communicated.
- Sending the notification to the debtor of its inclusion in the file . After adding your data to the entity’s file, a certified letter is sent to you. It warns of what happened and the negative consequences that this entails. Because this file will be consulted by banks, insurance companies, financial institutions, etc., preventing you from requesting financial assistance in the future for the activity or resource you need.
- In the case that it is a company that owes the money, from Personal Blog a method applied to Google has been developed. When you consult your name in this search engine, the option of whether you want to consult for free if that company has defaults appears in the top positions .
For more information about defaults, debt claims, financing issues or any kind of fair consultation and other topics, we invite you to continue reading the Personal Blog blog. 5.0 02