When is the right time to handover?

Generally, if an account is 30 days and older, most creditors have already broken the terms and conditions of the credit granted and the relationship has deteriorated. By now, the debtor has received all statements and letters and the creditors have also expressed their lack of response to payment.

The following are indications of serious cash flow problems and are good reasons to hand over earlier than the prescribed 90 days:

  • TELEPHONE NUMBER DISCONNECTED The quicker you investigate and follow up the better your chances of recovery

  • REPEATED REQUESTS FOR DOCUMENTATION This is a common practice and is mostly used when debtors want to buy more time

  • I WILL TAKE CARE OF THE ACCOUNT” but refuses to provide a specific date and time of payment

  • BROKEN TWO OR MORE PROMISES - Indication that debtor could not manage to raise the funds and the quicker you get in line the better your chances of recovery

  • I KNOW I RECEIVED THE GOODS / SERVICES BUT WHOEVER IS RESPONSIBLE IS......”
    This phenomenon occurs in many cases. The one party incurs the debt and refers it to the other party to pay. These disputes are not easy to deal with and tact should be used when confronting the debtor

  • CAN’T PAY - DO WHATEVER YOU WANT” In most cases this is only a threat with the expectations and hope that you forget about it

  • RETURN TO SENDER MAIL - A clear indication the debtor has absconded

  • DISPUTE ARISES WHICH WAS NOT RAISED PREVIOUSLY This is often another delay tactic to buy more time

  • DEBTOR CLAIMS * TO BE UNEMPLOYED - If in doubt a very good reason to hand over

  • NEVER RECEIVED AN ACCOUNT - The most popular excuse under the sun

  • I JUST DID AN EFT - No! You did not


Tips for a successful debt reduction strategy

Most people can easily fall into financial difficulty. Some are simply quirks that do not cause any financial harm - for others it becomes a nightmare or a vicious cycle of seeking credit, stress and ultimately, insolvency.

Research shows that debt has more to do with people’s behavioral patterns and their self-esteem. What we learn from research is that we need to assist debtors to be financially responsible. Debtors need to understand more the value of money and that paying off their debt will give them more flexibility. If you are out of credit, you will have no margin for error in case of an emergency.

It is therefore crucial for debt collectors to realise the importance of motivating people in paying their debt.

We all know how easy it is these days to get credit. Most spenders have little idea how much their purchases cost - because they live on credit.

  • Agree upfront on price

  • Send your invoice to your debtor/client on a daily basis

  • Be accurate with the information on your invoices and statements

  • Ensure that you grant credit to debtors/clients that can afford to pay you

  • Demand full detail of your debtors/clients

  • When delivering a service/product make sure that you get a suretyship form signed

  • Find innovative ideas on how to make it easy for the debtors/clients to pay you

  • Offer your debtors/clients discount on their statement if paid within a few days but be strict and exercise effective credit control

  • Don’t allow your debtors/clients to lobby your terms and conditions. Be strict

  • Practice your policy. Advise your debtors/clients of your terms and conditions

  • Train your staff to always overcome excuses made by the debtors/clients not to pay

  • Get your clients to enter into a written agreement with you prior to delivering the services / goods, and don’t forget the terms and conditions and suretyship form


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