Problem customers and late payers can cause all manner of problems for business owners in the UK. If your business has provided goods and services to a customer, it is only right that they pay.

It is common for people to take court action against their debtors when it is clear that they won’t pay. In many cases, a County Court Judgement (CCJ) will be issued against the debtor. This is a court order that is used if a debtor has failed to pay.

In the UK, there are half a million CCJ’s issued every year. If a debtor is judged to owe the money to the original creditor, they will have a CCJ issued against them. This will stay on their credit record for up to six years.

Having a CCJ made against a debtor can make it difficult for them to secure credit in the future. Creditors will be able to see this, and will most likely refuse credit.

Some debtors will still attempt to withhold payment. This is despite the threat of enforcement as well as the penalties imposed by a CCJ. If this happens, a robust and effective debt recovery process would be required.

With this in mind, there are several steps you can take to resolve the matter. In most cases, it is more beneficial and effective to hire the services of a professional. A debt collection agency will be able to resolve the matter quickly and amicably. In this article, we look at the possible solutions available for CCJ debt collection.

CCJ Debt Collection – Debt Recovery Methods

Once a CCJ has been issued against a debtor, the amount must still be enforced. Despite the problems it would incur, some debtors will continue to withhold payment. Here are several steps that can be taken to resolve the issue and recover the money.

High Court Enforcement Officer Attendance

In many cases, a CCJ has been issued against the debtor that has proven unsuccessful. If this happens it is appropriate to reach out to a Country Court Bailiff to enforce its collection. As well as this, a High Court Enforcement Officer is also another option.

A Bailiff is permitted to enter a debtors property and seize any assets. These assets make up the value of the amount owed. High Court Enforcement Officers normally have a higher success rate than Country Court Bailiffs, due to the higher authority they have.

The use of either is normally a straightforward exercise and is often an effective way to recover money that is owed.

Charging Order

A charging order can be applied when a CCJ has been imposed upon a debtor. This order is a charge placed by the court. It charges the debtor what they owe when they buy a new property.

This charge will be added to the cost of the property and includes all court fees and administration costs. This charge must be paid and is a guarantee that you will be able to recover your money at some point.

However, you may not be repaid right away as the debtor may take their time when searching for a new property. Creditors may be able to force a sale, however, which can speed up the process.

Bankruptcy and Winding Up Petition

A “winding-up petition” is a county court claim that can be presented when a debtor owes more than £750. This letter of claim is a demand that payment is made, and can force businesses into voluntary liquidation. This situation occurs if the petition has been made but the debtor still chooses to withhold payment.

The debtor’s company is considered legally insolvent if it cannot meet its own financial obligations.

Hiring a Professional

Many business owners obtain a CCJ against their debtor but they are still unable to secure payment. Many even try the techniques above with no result.

Collecting a County Court Judgment CCJ can be a frustrating a costly experience when performing the task alone. In many cases, it seems like recovering money owed from the debtor’s bank account is impossible.

However, a professional debt collection agency can often provide the swiftest and most beneficial option.

The UK Debt Collection Bureau’s members are the leading recovery agencies in the country. Each one has been approved by our in-house experts and has a proven record of success.

CCJ Debt Collection – Frequently Asked Questions

Being owed money from someone in another country is a common occurrence. Both businesses and private individuals can deal on a global scale at the press of a button. Whilst this opens up huge opportunities, it also provides a huge potential for cross border debts to occur.

Many debtors think that if they are based in another country, they are completely free from any prosecution. Whilst they themselves may not be required to return to the UK physically, debt collection can still be enforced remotely.

There is a growing need for an effective international debt collection service. Whilst many options exist, finding one that is trustworthy, reputable and effective is often a challenge.

Recovering a foreign debt can be more complex than normal domestic cases.

For example, simple factors such as the native language of the debtor’s country might need to be taken into account. Or, the time zone might be completely different, making it difficult to contact during UK working hours.

As well as this, there may be cultural differences that have to be observed. This also includes the knowledge and expertise required. For example, it is important to know the exact laws the debtor’s country has for recovering owed money.

Can a Foreign Debt be Collected in UK – Recovering Owed Money

Finding the right solution for international debt collection takes time and thorough research. Here are some tips that will help you to narrow the search.

Expertise

One important factor to consider when looking for an international debt collector is their expertise. Collecting debt from another country requires in-depth knowledge and specialist expertise.

Reputation

You should always research the debt collector you are looking at instructing before committing. Look for client reviews on third-party websites that will provide detailed insights into the company.

Accreditation and Approval

Many agencies are not regulated, and as such may employ debt recovery tactics that could cause problems for the client. You should always search for an agency that is authorised and regulated by an official organisation. One example of this could be the Financial Conduct Authority (FCA).

Some key areas of debt collection in the UK are focused on the country’s export partners. Several examples of these include:

• Debt Collection in the USA
• Debt Collection in Ireland
• Debt Collection in the Netherlands
• Debt Collection in France
• Debt Collection in Germany
• Debt Collection in China

Can a Foreign Debt be Collected in UK – Frequently Asked Questions

Every business will need to look into debt recovery services eventually. Unfortunately, the trend of clients that do not pay their bills is almost a daily normality for companies in the UK.

Studies conducted for 2020 showed that a staggering four out of five small businesses was owed money from a client. In many cases, the business owner had to fund the business with their own money, just to keep it afloat. In other, more serious cases, the business was forced to close due to cash flow issues due to the effects of late payments.

Various options for enforcing the collection of owed money exist. It is often the best solution to instruct a business debt recovery agency.

The value of Business to Business Debt Recovery for Businesses for the UK economy should not be estimated. Hundreds of millions of pounds is recovered every year.

In this article, we explain the benefits of using a business debt recovery agency. As well as this, we look at the various types and specialities each one has.

What to do When Owed Money – Setting up a Business to Business Debt Recovery Protocol

Many businesses are set up for starting a debt collection process in-house. For example, when a debt is first declared overdue, a dedicated credit control department will be tasked to chase the debtor. Quite often, this is done through the process of making phone calls and sending emails.

Other companies implement robust pre-action protocols, with payment terms and late payment interest charges. These provide a debtor with an incentive for paying on time. They can also often be a good way to stop bad debt before it occurs.

In some cases, this can be effective. Payment reminders or the threat of a service being cancelled can prompt the debtor to pay what they owe. However, there are always those debtors that will simply ignore any communications.

When this happens, hiring the services of a professional is always a cost effective and pragmatic decision.

Business Debt Recovery UK – Types of Agency

A business debt collection agency will often specialise in a specific industry sector. For example, Frontline Collections is regarded as the UK’s leading agency for recovering private schools debt.

Often, a business’ clients can either be other companies, or private individuals. In some cases, recovering a commercial debt from an individual would need another type of debt collection agency. However, the vast majority of business debt collectors can enforce the collection of debt regardless of who the debtor is.

Likewise, Federal Management is well known as the UK’s leading commercial debt collection agency. They focus on collecting business debts resulting from things such as unpaid invoices or client disputes.

As well as this, there are also international debt collection agencies that are experts at recovering business debt from overseas.

To summarise, regardless of who your client is or what industry sector you are in, a specialist solution is available. Finding and choosing from these agencies is another matter. This task often requires a great deal of time and research to ensure that the correct option is chosen.

Choosing the Right Business Debt Recovery Agency

With the number of debt collection agencies available, finding the right one for your unpaid commercial debt collection needs to be a careful decision.

The Debt Collection Agency UK is the UK’s top group of award-winning debt collection agencies. Each one of our members is a proven leader in their field of debt recovery.

Our service is completely free and open to anyone, both businesses and private individuals. By completing our quick and easy to use web form, you can begin finding the best recovery agency for you.

This service saves hours worth of searching manually and only recommends the agencies in the UK that are proven and effective.

Using a Business Debt Recovery Agency – Frequently Asked Questions

Preventing debt is one of the best ways of maintaining a stable cash flow in a business. Setting up a robust payment terms document at the beginning of any agreement can help to set the expectations of all parties, as long as everything is explained clearly.

In a perfect world, this would be enough, and all clients would pay as expected on the payment date. Unfortunately, it is no secret that there are always those clients that try withholding payment regardless of the best-laid plans.

When this happens, a common way to handle the matter is by adding late payment interest charges onto invoices that miss the due date. The effects of late payment can be minimised with this.

If implemented correctly, this can be an effective countermeasure, as this works as an incentive for ensuring all clients pay on time.

We asked our debt collection experts how charging interest on late payments works, and what the alternatives were for cases where it is not effective.

Can I Charge Interest on Late Payments?

Many businesses are unsure if they can charge late payment interest on commercial debt. For those that are in doubt, the British government has a very clear explanation on the subject on their website.

Businesses can claim interest on late or unpaid invoices and use this base rate as a guide. The base rate has the following example:

“If your business were owed £1,000 and the Bank of England base rate were 0.5%:

• the annual statutory interest on this would be £85 (1,000 x 0.085 = £85)
• divide £85 by 365 to get the daily interest: 23p a day (85 / 365 = 0.23)
• after 50 days this would be £11.50 (50 x 0.23 = 11.50)”

It is common for businesses to include this as a clause in their terms and conditions, as in some cases it helps to prevent late payments.

Unfortunately, this does not work in all cases, and regardless of what the rate of interest is, many debtors will try to avoid paying no matter what.

Recovering Debt

Despite the best preventative measures, there will always be a need for a debt collection process to be prepared in every business. Non-payment of commercial debts is something every business owner is familiar with.

Historically it has been common for companies to take legal action against their debtors. This involves going through the court system in order to resolve the matter. However, this can often be too expensive, a factor that often results in the debt being written off.

For businesses today, professional debt recovery agencies are often sought after as a solution to the issue of commercial debt. A commercial debt collection agency can provide a low cost and effective service.

The UK Debt Collection Bureau’s members are all award-winning and accredited agencies that have a proven track record of success.

For more information on how our partners can help your company to recover its debts, speak with one of our friendly experts today.

Charging Interest on Late Payments – Frequently Asked Questions

Selling debt to a debt collector has been an option for a long time. It is commonly used as a last resort when it is no longer economically viable to continue an ineffective credit control strategy. For example, if a business has a large portfolio of debt that they are unable to recover themselves, they may attempt to sell this to a debt purchase company.

However, selling a debt will only recover a drastically small amount of money compared to what could be claimed back with a more effective collection process.

Most companies that seek to buy debt are a special type of debt collector. They make money by buying old debt at a low price, to then use their expertise to collect the full amount later and make a profit.

As such, these agencies often use overly aggressive tactics to recover what is now owed to them, and has been described as a “grimy business”.

Whilst the original creditor may be in a difficult position, selling off their owed money to a debt buyer may not be the best solution. Many people are unaware of what options are available to them when it comes to debt collection, and as such may unknowingly sacrifice their chance to recover all of the debt.

We asked our in-house debt collection experts about the negative side of selling debt, and what the alternatives were for recovering owed money.

Buying And Selling Debt – Debt Purchase vs Debt Recovery

The process of selling debt is very simple. The original creditor agrees to pass the debt over to the debt buyer for an agreed amount who then inherits the debt. It may be surprising to find that people are willing to buy debt, and many people are more than happy to sell it when they have had no success recovering it.

However, the debt buyer is normally a debt collector, who will then go on to take every step to recover the full amount of the debt for themselves. Needless to say, finding out that the full value of the debt was recoverable after all is a hard pill to swallow.

However, there is an alternative option in the form of instructing a debt collection agency. This is regarded as a better option, as it allows the creditor to recover the maximum amount possible, whilst being cost-effective.

A professional debt collection agency will operate on a low-cost commission-based structure, and provide an effective service. Success rates are normally very high, with our partners achieving a 90% average collection rate on undisputed debt.

As well as this, the leading debt collection agencies provide a fully regulated and accredited service. For example, one of our award-winning partners registered in England is the only agency to be regulated by the Financial Conduct Authority (FCA).

Whilst there is a cost to using their services, a debt collection agency provides an effective recovery option for those who are struggling to collect owed money. This means that you would be able to recover the maximum amount possible minus a small commission, instead of selling debt for a very low value.

Debt Collection Companies for Small Businesses have a very valid role to play in the modern world of Business commerce. Working with a proficient one can help maximise the profitability of any Company.

In the interest of recovering money that is owed to you, you will need an organisation that you can trust from the start.

You may come across the marketing term “No Win No Fee” when conducting your research.

In this article, our professionals have put together some guidance on The Truth About No Win No Fee Debt Collection.

“No Win No Fee Debt Collection” – What Is It?

No Win No Fee Debt Collection has been banded about for decades by some debt collection agencies.

It suggests that if a debt cannot be recovered (win) then there will be nothing to pay in the end (no fee).

Unfortunately, corporations use this as a marketing ploy to disguise the type of pricing structures they conduct.

Typically these consist of the hiding of fees along the way which turn out to be a large sum at the end of the debt recovery process.

Not only this, but groups working in this sort of way may force their customers into memberships without previously asking.

Having to pay upfront fees is a complete contradiction of what is promised on a no win no fee basis.

The cowboys of the industry will take on a debt regardless of whether they know the success rate is going to be positive or not, which can be extremely harmful to the sustainability of one’s finances.

No Win No Fee Services Are More Expensive

If the debt collection agency has promised you this service, the “no fee” element will notoriously be false.

You may be expected to pay a joining fee, and then charged random fees in quick bursts throughout.

This price-drip method almost always ends up meaning you pay a lot more than you realise.

Similarly to this, you may additionally be charged an abandonment fee should you wish to stop using the company in question or they cannot collect the debt.

What Is The Reputation Of The Agency?

Does the organization you are using have the ethics and traits of an honest debt collector?

You will find that most companies that work off a No Win No Fee Debt Collection Policy will have no licenses or authorisations by regulatory bodies.

For example, our partner Federal Management is authorised and regulated by the Financial Conduct Authority (FCA).

Agencies like this will most likely have a bad reputation when it comes to dealing with debtors and uses unjust methods for the collection of your monies.

At the end of the day, it is you who will have the responsibility for their actions and this could mean the relationship with your debtor is jeopardised.

Alternatives To No Win No Fee Debt Collection

Now that you are aware of the truth about No Win No Fee debt collection, you can see why you should avoid anyone with this label.

At the UK Debt Collection Bureau, we have collated a list of the most compliant and reputable agencies in the UK.

Our list is comprised of some of the most affordable and trustworthy agencies in the UK that offer “No Collection Costs = No Collection Cost To Pay” services.

This is different to No Win No Fee, as they will only take on debts if they believe they can successfully recover the debt in question.

For Commercial Debts, you should use Federal Management and Frontline Collections for Private and International Debt.

Have you ever experienced a situation where you have lent money to someone and they are refusing to pay it back?

Do you have customers that are ignoring you when you ask them to pay you for your services?

There are many ways in which someone may try and get away with not paying you.

When this happens, you will understand how frustrating this can be.

Recovering money that someone owes you can be a challenging subject to tackle…

…and knowing how to conduct a successful recovery is vital.

Regardless of HOW you do this, the goal at the end is to ensure that you get this money back to you.

There are many options available for debt recovery in the UK, but which should you choose?

For example, one of the most common ways of this is to independently collect the debt.

This involves taking matters into their own hands and tracking down and confronting the debtor themselves.

Alongside this, instructing a professional debt collection agency is one of the most popular methods.

It is all well and good outlining the two best methods, but understanding which is the best one is of top priority.

In this article, our experts have put together guidance on which is the best option to choose for Commercial and Private debt collection.

Choosing the wrong method can be the difference between getting your money back or nothing at all.

How To Independently Collect A Debt

So many gravitate towards collecting a debt alone as they believe it is the fastest and cheapest way to do it.

It is understandable why so many use this method of recovery.

Although it is not, and never will be, the method with the highest recovery rate, it still works.

The option to collect a debt by yourself has been easier for businesses.

This is due to in-house credit control teams that chase payments that have been left unpaid.

Credit-controllers are trained to negotiate with those that owe money…

…which will result in the organisation getting paid and the debt is erased.

When a debtor refuses to pay even after negotiation, it is important to know where you can escalate this too.

Those who are private individuals will not have access to a credit-control team and will have to do this by themselves.

This can be a difficult situation for individuals and those who are self-employed, as this takes up a lot of time.

The time spent to learn how to recover a debt and then action this should be used to continue to grow your business.

Recovering a debt alone can also be a costly exercise which isn’t ideal when you are already owed money.

Not only this but if you take the wrong approach to recover your debt, this may be unlawful and you may get in trouble.

When a creditor starts to being too pushy, the debtor may become annoyed.

This could result in the authorities becoming involved.

Knowing the best and most lawful way of getting your money back can take a lot of time that you may not have.

It’s vital to remember that this method will stop you from working on beneficial business exercises.

As well as this, you may want to consider the effects it may have on your relationship with your debtor.

If someone owes you money, this can make you feel negative emotions such as stress or anxiety.

These may cause you to act confrontational when you communicate with your debtor.

Not only this, but debtors are notorious for trying to provoke those they owe money to.

This may result in an argument with your debtor, which will make it a lot less likely that your money is going to be paid.

Jeopardising the relationship with your debtor can be damaging to your business’s future.

You must do everything in your power to ensure you maintain your finances.

Although the option of collecting alone can be successful, it is better to instruct a debt collection agency.

Instructing A Professional Debt Collection Agency

When someone owes money to you or your business, there is one clear method that is best to use.

A specialist debt collection agency is the most trustworthy and hassle-free way of collecting money owed.

The main benefit of this method is that it allows individuals and businesses to focus on their day jobs…

…rather than having to take time out to try and recover these debts by themselves.

The way the debt collection process works is also fairly straightforward and requires no effort from your side at all.

The experts will get in contact with your debtor and tell that they owe money to you that needs to be paid.

All communications will be done so in a professional, calm and clear way, making sure to respect the relationship with your debtor.

At UK Debt Collection Bureau, we have a list of recommended Debt Collection agencies that are the best in the UK.

No matter where or who your debt has originated from, our partners can recover this.

These agencies operate the UK’s highest recovery rates of up to an average of 90% on all undisputed debts.

This will ensure that the service you are getting is the most affordable it can be which means you won’t be over-charged.

When a problem debtor owes you money, do not hesitate to choose this option straight away.

For Commercial Debt Collection, our recommended partner is Federal Management.

Federal Management is the only agency in the UK that is regulated by the Financial Conduct Authority (FCA).

For Private Debt Collection, we recommend using Frontline Collections.

Frontline Collections are accredited by the Credit Services Association.

They have also been awarded “Gold Preferred Supplier” status by the Independent Schools Association (ISA).

If you have a debt that is based overseas, choose Federal Management International.

All of the above have the following characteristics of a good debt collection agency:

• A large number of positive customer reviews
• High recovery rates
• Low commission rates
• A large team of experts, with regional offices to help across the UK
• Accreditations with industry organisations
• Polite and professional

For businesses and private individuals in the UK, the occurrence of unpaid debts has increased in recent years.

Problem debtors are coming up with more and more excuses as to why they cannot (or will not) pay their invoices.

In a survey that was conducted by BACS, around 43% of SMEs experienced late payments. A large percentage of overdue payments were more than 2 months late.

Statistics like these highlight the issues posed by debtors that choose not to pay their invoices. They also show the impact this can have on one’s finances.

When a business or private individual is owed money by someone, this can severely affect their cash flow.

A domino effect can occur if cash flow is impacted, with other areas of the business having to suffer.

In regards to the act of collecting money that is owed to someone, there are a variety of options to choose from.

Many creditors still use outdated methods such as trying to collect debts independently or by using Solicitors.

Both of these options can be expensive and can waste a lot of time in resources to provide ANY form of result.

Remember – you are never guaranteed a successful recovery if you try to collect a debt independently.

The best and most efficient way to perform the recovery of a debt is by using a professional debt collection agency.

This recommendation may leave you to wonder what the benefits of using a professional debt collection agency are.

Our team of experts have put together guidance on what makes a good and bad debt collection agency. This will ensure you get the best service possible.

The Benefits of Using A Professional Debt Collection Agency – The Good and Bad

Whilst most of these agencies are good, there are so-called ‘cowboys’ within the industry that you will need to watch out for.

Unlike our trusted partner agencies, there are those that will get away with providing an unjust service to their customers.

Many businesses have had good experiences with a debt recovery partner. Working with Debt Collection Agencies in Glasgow, for example, has helped thousands of businesses in Scotland recover what they are owed.

Agencies like these are able to blend in due to the large number of businesses that provide the same service.

The Bad – What Should You Look Out For?

The traits of a bad debt collection agency that you should be wary of can include:

• Unnaturally high commission rates.
• Little or no example of high recovery rates.
• A lack of accreditations.
• Price drip fees.
• Charges to the customer even if the collection is unsuccessful.
• Bad or low reviews.

Why should companies be able to operate a disappointing service like this when you are already owed money?

If a business or private individual is caught in the net of an unfair debt collection agency, this can be extremely costly to them or their business.

Regardless of the type of debt, you should never have to experience a bad debt collection process.

What Makes A Good Debt Collection Agency?

Whilst there are bad agencies out there, it is a positive fact that the majority operate to help their customers in the most effective way.

At UK Debt Collection Bureau, our partners only ever operate in the most professional manner possible.

Some of the characteristics of a good debt collection agency are:

• A large amount of positive customer reviews.
• High recovery rates.
• Low commission rates.
• A large team of experts, with regional offices to help across the UK.
• Accreditations with industry organisations.
• Polite and professional.

Debt collection agencies that provide a good service are always polite and professional when dealing with your case.

Being owed money can be a stressful time, so the helpful nature of such businesses should help alleviate this.

The Benefits Of Using A Professional Debt Collection Agency

Based on the information provided, you should now be able to apply this when searching for an agency to collect your debt.

Using the services of a pro-active and pragmatic Debt Collection Agency is the only way you should be collecting your debts.

What Are the Benefits of Using a Professional Debt Collection Agency?

There is a plethora of benefits towards yourself and your business that come from using this method.

Debt Collection experts have all the resources required to efficiently collect unpaid fees. This includes expertise, training and time.

As well as this, they often have collection offices based at strategic locations in the UK. Examples could be London, Manchester, Leeds, Birmingham and Glasgow.

This will no doubt give you peace of mind, which is vital in a stressful situation such as this.

By passing your debt onto a team of professionals, this will allow you to focus on value-based tasks such as growing your business.

This is due to the amount of time and resources you will save by not collecting the debt yourself.

In turn, this will also contribute to the amount of money you will save as your core focus will be on continuing and bringing in more work.

Another benefit of using a debt recovery agency is that the relationship between yourself and your debtor will not be jeopardised.

We have experienced clients that have shown distress by thinking they will lose their client or customer if they try to recover a debt.

No one has ever lost a client simply because they were required to pay!

The Benefits of Using A Professional Debt Collection Agency – Our Partners

Now you are aware of The Benefits of Using A Professional Debt Collection Agency, which means you can choose an agency to collect your debt.

At the UK Debt Collection Bureau, we are dedicated to helping those that are owed money by providing a list of the top Debt Collection agencies in the UK.

No matter your situation or type of debt, our expertly trained partners can assist in collecting your debt.

For Commercial Debt Collection requirements, we recommend Federal Management.

If you have a Private or International Debt, our recommended partner is Frontline Collections.

The coronavirus pandemic has affected not only people’s health but also their financial condition.

It has affected business and trade, especially for small-scale businesses.

This is because customers have not paid the money for goods and services on time.

Coronavirus’s impact means that the world has faced big economic losses. This partly due to shutting down services since the lockdown was imposed.

It is an issue that many countries are still dealing with today.

If you own a business, you understand that no such situation is predictable.

In such unprecedented circumstances, you have to be patient enough to deal with the customers.

The pandemic has complicated many things.

What has not changed, yet, is that some people still want to avoid paying the money that they owe. It has been easy for many to use the lockdown as an excuse.

Ultimately, you have to recover that money from the customers. It is useful to know some accurate and effective tips in circumstances such as these.

Regrettably, many people have had to deal with issues like the loss of a job during the pandemic.

When working on the debt collection process, it is important to keep this in mind.

You may have to compromise and provide some extension for the payment.

Here are a few tips to help small business owners to get through the difficult coronavirus period, and to cope with the financial conditions.

Customer Not Paid Due To Coronavirus? Talk With The Client

If one or many of your customers have not paid for goods or services, you should always try to talk to them calmly.

Do not get aggressive while asking for your money. This risk’s degrading the quality of your relationship with your customer and can affect your company’s reputation.

You might be anxious while thinking about your money, but do not show this to the customer.

Being frustrated is common, but try to relax and politely interact with the customers.

Politeness and professionalism can be the key to recovering money from non-paying customers.

You can contact them through any means, but ensure that you do not seem rude to the debtor.

If you are collecting the debt yourself, it is advisable to avoid a direct meet up with the client.

The situation with Coronavirus is still not safe enough to meet personally. It would be inappropriate to visit their house or workplace to get the money.

You can contact them through the phone, by email, or an SMS text message.

Customer Not Paid Due To Coronavirus? Take Note for Further Customers

If you are interacting with new customers, it is sensible to ensure that they have the money to pay for your services.

It may prevent any further losses, and you do not have to chase the customer if they do not pay.

If you do not carefully vet the customers you deal with in the future, it can be dangerous for your business.

Your past experiences with a problematic client can teach a lot

If you have had to deal with the losses because of a particular customer, you should learn from that and avoid making the same mistake again.

Small businesses have to protect themselves from any big loss. It is critical when running a successful business.

Customer Not Paid Due To Coronavirus? Understand the Genuine Issues of Customers and Make the Payment Flexible

Over the course of the pandemic, many people have been furloughed.

Whilst proving to be a much-needed lifeline for many, it has nonetheless resulted in the degradation of their financial condition.

So, if you know of customers who are in a difficult financial position, try to be understanding of the issues they are facing.

You may have to make an agreement and change the conditions of repayment to provide some relief to the customer.

While discussing options with the client, be realistic according to the situation.

This coordinative behaviour will benefit you as a business owner if the person is facing some real problems.

Being polite and patient is important as the customer’s income has been significantly affected.

While making the repayment agreement, make sure you consider that customers might be getting 80% of their income.

This should prevent any more losses. If you consider it in the repayment loan agreement and offer relief to the customer by maintaining a healthy relationship.

Customer Not Paid Due To Coronavirus? Get Help from a Debt Collection Agency

Debt collection agencies are working worldwide to help business owners and individuals to collect a debt from any persons.

If your customer has not paid the amount that they owe you, you should hire a professional debt collection agency.

They will send a legal notice to the customers instructing them to repay the amount to you. If the customer does not respond to it, the team can escalate the matter.

You should provide proof of debt, which will show how much the customer has to pay. All the conditions will be written on that agreement to avoid any discrepancy.

This will help your case if the circumstances lead the situation to court.

Spending time researching the debt collectors available to you is sensible. Finding the one with the most expertise and success will all add up to help you.

So, you have to analyse all the factors carefully before contacting the debt collectors.

If you have already tried to collect the debt independently and are still waiting to be paid then you should contact a collection agency.

Going through the legal process should be your last option of collecting the debt from the customer.

Not only is this time consuming and expensive, but it can also affect your professional relationship with customers.

In Summary

The coronavirus pandemic is taking its toll on every person worldwide, and the lockdown has led to a great proportion of unemployment.

In such a situation, business owners find it difficult to get customer’s money which is owed to them. Still, there are ways to recover your money while maintaining healthy relationships.

If none of them work, you can instruct a debt collection agency.

The collection agency can recover the money for you. Ensure that you have proper details written on an agreement between you and the customer.

Therefore, you need to put some strategies in place in order to ensure that unpaid invoices do not affect the sustainability of your business. It might sound a bit dramatic, but it definitely deserves the time and effort.

Unpaid business invoices can affect almost everything from interrupting cash flow to the operational activity of your business.

If too many unpaid invoices are accrued, then it WILL affect your profitability. This means you won’t be able to pay suppliers, vendors, and employees, which result in reducing your reputation among your business personnel and clients.

Thus, dealing with unpaid business invoices requires your immediate attention, but you might be wondering how?  Our expert team of debt collectors have created the following strategies which will help you discover a way to clear all your unpaid bills.

Ensure That You Have Followed The Right And Legal Procedure, And Then Proceed Politely

When confronted with an unpaid invoice, many business owners have jumped to conclusions and begin spamming your customer with threatening or nasty messages.

With this in mind, you need to make sure that you have followed the right and legal procedure for dealing with unpaid business invoices.

The main rules of this are that you should make sure that you have sent the invoice to the right person at the correct address. You should also confirm that the terms and conditions of payment are clear as well as the total amount due.

It would be a tremendously embarrassing moment for you to realise that it was your fault for sending the wrong amount of debt owed, or to have made another mistake.

There may be a perfectly innocent explanation for the unpaid invoice, for example invoices can sometimes be lost by the client, or maybe a client is out of town or dealing with any emergency.

Therefore, before losing your temper, you need to deliver a brief follow-up email written in a polite tone. This could begin with something like “just checking in…”.

Thus, an email like this can increase the chances of getting your invoice paid faster.

Before sending any emails, make sure that you don’t use phrases which may be inflammatory, as it will help maintain a good relationship with your client in the future.

Offer A Full Settlement Scheme And Charge For Penalty’s

When you offer your customers and clients a discount deal or full settlement scheme for early payments, they will be encouraged to pay their invoices well before the due date.

However, bear in mind that it is relatively uncommon to provide a one to two percent discount on the whole amount of invoice if your customers can pay within 10 minutes. But one should know that not all clients and customers are motivated by an incentive scheme.

Hence, you can motivate them by charging a penalty after the due date. It will make customers pay their bills faster and allow you to resolve the financial problems that you might be suffering from in your business.

You probably don’t want to find yourself in a situation where you cannot even pay your bills that might be incurred when customers were late in paying their dues.

Make Use Of Collection Agency, Mediation, Arbitration, Court

If you are still suffering from your unpaid business invoice, you need to take some serious action, especially if it has been over 90 days since issuing the invoice. When it becomes less and less likely that the owed debt will be paid back, then you should use the services of a debt collection agency to assist you in getting your invoices paid on time.

Firstly, if you have a valid contract, you need to review it carefully as it will be a key document to help with getting your payments.

If your clients are local, you can seek the help of business mediation services. This process will include an experienced and trained mediator, who can handle the situation and resolve the dispute as soon as possible.

Occasionally it might happen that the customers simply do not want to pay as they are going through some kind of financial instability. If this is the case, it may be appropriate for you to provide them with a 3–6-month long payment plan.

If you choose to do this, make sure you make everything clear in a carefully worded email, which encourages them to pay back their bills as fast as possible whilst being respectful of their position. 

Unpaid Business invoices are something that every business must focus on preventing. Letting them happen can affect the operational activities of the business. Due to a lack of cash flow, you might not be able to pay your creditors, suppliers, or vendors, which can affect your ability to provide your services to your clients’.

These are the top strategies you need to consider if you are not getting your business invoices paid on time.