Challenge Commercial Collections

Your Checklist Questions for Choosing the Right Debt Collector

Choosing the Right Debt Collector

For common services like finding an electrician to help out with some wiring around the house, or searching for a trusted local doctor, there is no substitute for a good personal recommendation.

But in some industries, recommendations and personal experience are harder to find, and we think that debt collection can sometimes fall into this category. Just like your banking, debt collection deals with the sensitive topic of your business and/or personal finances, so you need to be able to trust the company that you work with to collect your outstanding bills.

But getting the information you need to make the best decision can be difficult when you have limited knowledge of the industry. To help, we’ve put together a checklist of questions that you can use when considering the right debt collector for your business.

Client List

Debt collectors typically work for a wide range of clients, from small mum and dad stores and local businesses to larger commercial clients. But of course, there are exceptions to every rule, with some firms choosing to focus on a particular size of client or a particular industry.

While specialisation can be useful, it’s important to remember that there are great benefits to working with a company that has a broader client base. The skills and learning from different types of jobs can be brought “in house” and can build the effectiveness of a debt collecting operation, compared to other debt collectors who have a narrower focus.


Debt collectors have to work within a very comprehensive set of rules and legislation to maintain their accreditation as a professional organisation. Check with your potential debt collector about their industry memberships, history, and the standards to which they abide. Browsing the website of the agency is also an easy way to get an idea of the standards that the company works to, as well as their values.

Track Record

Asking a company directly about their track record is a good way to gauge their professionalism and success. Reputable companies will not disclose specific client or job details, but successful ones will be able to provide you with statistics about their success rate, repeat business or past client testimonials.

What Experience Do You Have?

As with many other professions, including building and medical services, debt collection agencies absorb a lot of experience into their organisations through the course of their work. While experience is no guarantee of success, those agencies with strong experience and long serving staff have the edge over newer operations. The lessons that they have learned through operating in a challenging industry are invaluable.

What Methods Do You Use?

Different debt collectors and debt collection agencies use different methods to collect outstanding debts on behalf of their clients. These can range from the simplest phone calls and reminders, to formal letters of demand in the post.

It is important to remember that a debt collector acts on your behalf, and will likely be associated with your personal “brand’ or business. Because of this, it is worth enquiring about the methods that debt collectors will use, as well as setting out some guidelines for the practices you are and aren’t comfortable with.

How Can I Keep Up to Date?

Debt collection is not a one-step process, and often, if a bill or unpaid invoice is difficult to settle, debt collection can be a multi-step, drawn out series of events. While you are paying your debt collector for results, it also makes sense that you want to be updated about their progress and how the actions they are taking to recover your debt are working.

What Are Your Remittance/Return of Funds Policies?

Debt collection is about getting your bills paid and having funds returned in a timely fashion. It doesn’t make sense to engage the services of a debt collector, but then have to wait as long to have the funds returned to your bank as if you had just waited for the bill to be settled yourself.

Most companies have a remittance policy that states how long it will take for the money to reach your bank account after they recover those funds from your client, and it’s worth asking what that time frame is at the outset.

What is Your Fee Structure?

Debt collection is a service, but the fee structure that different agencies use varies widely. Some work on a no collection/no fee basis, others charge an up front fee plus a percentage of the successful recoveries, and others only take a portion of the recovery.

Other methods and fee structure incorporate a tiered system, which basically works on a sliding scale depending on how much the total and age of the debt is, while in some cases, you can also negotiate fees with the agency.

All of this makes a straight “apples with apples” comparison difficult, but it’s important to know the facts about the fee structure early, so you fully understand what you are paying for the service.

If you would like to learn more about how the local team at Challenge Collections can help you recover your unpaid debts, please give us a call on (07) 3808 7001.

Alternatively, you can email us to have the above, or any other questions you may have, answered.

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