Older debt collection strategies relied on applying heavy pressure. A common technique, aggressive strategies have been the forte of authorities. However, with each debt a different story, is this technique highly outdated?
Best debt collection strategies: mediation over aggression
Bristol city council has announced trials of more ethical debt collection strategies. In our last blog we discussed MPs accusations of councils taking a strong arm approach to all debts. We believe mediation, a human approach, should be the preferred strategy. Our belief is firm but fair debt collection will ensure the best results.
Following Hammersmith & Fulham, Bristol is the second authority to adopt this approach. Using bailiffs and court action to solve debt, especially consumer debt, is a drastic action. Surprisingly, many UK councils still adopt this approach. Many debts relating to local tax are not through not wanting to pay but rather being unable. Taking debtors to court when unable to pay will only bankrupt them and secures a moral victory, nothing more.
Craig Cheney, deputy mayor for finance, spoke to local press about the move. “Our new approach aims to be a more-ethical form of debt recovery. We recognise the mounting evidence. It concludes early intervention and support for those facing debt is an effective strategy”.
Our successful debt collection strategies rely on early intervention. Searching for a pre legal resolution, early contact is essential. AYOM always urges clients to move quickly with debt recovery. Debtors struggling to pay could find help in our intervention. Debt collection is about managing credit and finding appropriate repayment methods. Doing so with strong arm tactics isn’t advisable nor will guarantee success.
The “hired muscle” fallacy
Many people believe debt collection strategies are all about “hired muscle”. People believe getting bailiffs in to deal with the issue is all there is. This is far from the truth. Modern debt collection strategies are conversation based. We listen to the creditor, the debtor and mediate the situation. We must be firm, we must be fair, but we act in the best interest of the debt. 99% of debtors want a debt to go away, and they don’t want a CCJ on their record. Debtors don’t want to go bankrupt and don’t want a debt looming over them.
This is why working together is so important. Debt collection agencies build a relationship and find solutions. Solutions don’t have to include high court bailiffs or seizing property. We would consider this an extreme last resort. Even without bailiff action, our collection rates are incredibly high. It is because of this we ask local councils to resolve debt pre legally rather than via an enforcement route.
If you are a creditor and wish to settle your debt pre legally, call the experts. We operate across the UK, dealing with consumer, commercial and personal debts. To speak to one of our team today, call 0800 130 3357 or email enquiries@ayom.co.uk.