Businesses often struggle to recover unpaid debts owed to them by other businesses. Hiring a debt collection agency in Dubai can help due to their expertise, resources, higher success rates, and commission models. This article reviews 6 reasons why outsourcing B2B debt collection services to an agency makes sense.
1- Debt Collection Agents Expertise:
Debt collection agents are well-trained to carry out their job efficiently and cleanly. They are experts in:
-Communication strategies:
They know the most effective ways to contact debtors and apply the right amount of pressure to get a response and resolve the issue. Businesses often lack this experience.
-Negotiation tactics:
Debt management agencies staff are trained in negotiation techniques to get debtors to agree to payment plans, lump sum repayments or concessions. This often requires specialized skills.
-Legal Knowledge:
Debt collection agencies stay up to date on relevant laws surrounding debt collection practices. They know what practices are legal and legitimate to pursue.
-Technology tools:
Debt recovery agencies leverage tools like automated calling systems, payment platforms and CRM software to manage debt collection more efficiently.
-Debt recovery best practices:
They follow strategies and best practices developed over years of experience pursuing B2B debts. This knowledge gives them a higher chance of success.
2-Resources of Debt Collection Services:
-Dedicated staff:
They employ teams of trained collection agents, support staff and managers focused solely on collecting debts.
-Time:
Debt management agency staff have the time needed to regularly call, email and pursue debtors until debts are repaid in full. For businesses, debt collection is often a side job.
-Budget:
Debt collection agencies can afford to take legal action and pursue debts more aggressively since that’s their business. Many businesses can’t afford this.
-Technology:
As mentioned, agencies invest in technologies like predictive dialers, CRM tools, payment platforms and more to boost efficiency and results.
3- Stronger Influence:
Debt collection agencies have stronger influence with debtor businesses for a few reasons:
-Credibility:
Debt collection services agencies have a reputation for being persistent and potentially escalating matters legally if needed. This gives them more credibility with debtors.
-Pressure:
B2b debt management agencies are able to apply more pressure on debtor businesses through repeated calls, letters and even threats of legal or credit actions if necessary. This motivates debtors to pay.
-Impartiality:
Since debt management agencies are a third-party, debtors may be more willing to work with them to resolve debts impartially. They are seen as ‘just doing a job’.
-Specialization:
Debt collection agencies deal with chasing debts full-time, so they come across as more authoritative and their demands seem more legitimate to debtor businesses.
Read Also: The Benefits Of Cooperation With B2B Legal Debt Collection Agency!
4- Legal Options:
-Pursue debts through small claims court
This requires expertise in documenting debts owed, filing claims correctly and presenting a case in court. Agencies have this expertise.
-Threaten legal action
Even just the threat of legal proceedings from a debt collection agency can be enough to motivate debtor businesses to pay what they owe.
-Negotiate settlements
Debt collectors are trained in negotiating repayment plans and settlements with debtor businesses that are legally binding.
5- High Recovery Rate:
Debt management companies have recovery rates higher than businesses collecting debts internally for a few reasons:
-Expertise:
Debt collection agencies have communication strategies, negotiation tactics, legal knowledge and tools that improve their chances of success.
-Resources:
Debt recovery agencies have more time, staffing and budgets to dedicate to maximizing recovery from each debt.
-Pressure:
Debt management agencies can exert enough pressure on debtors through repeated contact, letters and threats to motivate payment. Businesses often aren’t as aggressive.
-Experience:
Debt management companies have years of experience collecting B2B debts, giving them data and insights into what works best.
Most debt collection agencies in UAE are charged only on debts they successfully recover, this model gives businesses an incentive to outsource debt collection since there is potential for much higher recovery rates with little to no upfront cost. The debt collection agencies only get paid when debts are actually recovered.