Are you recovering debts efficiently?
In the context of an unbalanced economy, where you don’t know what to expect at the end of the day, when the transition from high purchasing power and available sources of credit to insolvency and unreal interest rates is done from day to another, companies struggle to survive or to find creative and practical methods to remain in the game. Since money is the main pawn in the game, and their time means important money, companies should respond honestly to the question “Am I recovering debts efficiently?”
The solution is simple, at least in theory: an efficient and integrated system able to generate quickly a steady revenue stream, through identification, management and collection of debts from problematic accounts.
According to the Risks Central Bank (CRB), credits and liabilities of credit institutions are increasing:
Taking into account the cases registered at the National Trade Register Office, the number of insolvency cases is about 27% higher in 2009. Moreover, the sector distribution of bankruptcies in 2009 shows significant imbalances, especially in three sectors: distribution, retail and construction.
According to banking economic experts, the main factors that led to increased arrears are the following: the exchange rate, interest growth, and unemployment and health problems.
Benefits of a collection type system
Low costs and risks and high liquidity: An automated collection system eliminates the manual labor flows, both expensive and time consuming, which are necessary for the invoice management and communication with the outstanding customers. It also provides unique and centralized information on customers, contracts, invoices, associated payments or advances, guarantees, computed penalties, debts and the number of days past the due date. The DSO (Days Sales Outstanding) Indicator value is decreased by reducing the average number of days needed to convert debts into cash.
Complete delinquency tickets management: An effective collection type system configures, manages and monitors all aspects of the debt collection cases, from the first contact to the final payment. An automated collection solution manages the workflow and financial transactions, communicates news and events so that the whole company gets informed on actions taken, letters and text messages, recorded telephone calls, and configures and manages the actions required for closure in case of non-payment.
24/7 access and availability: The debt recovery systems are developed based on next-generation technologies that have intuitive interfaces and are designed to serve the company from anywhere and at anytime.
Integrated with a self care system, the collection system significantly improves the communication with customers and reduces the time spent on justifying new insolvency cases. Both the client and the company have constant and safely access to information on open cases statuses, registered payments and outstanding bills, debt recovery activities history. It also facilitates the online debt payment.
Complete history of steps, actions and events afferent to accounts: It provides real time access to each delinquency file status. Records contact data, type, afferent notes and their outcome, and it also provides access to all payment terms, made payments, promised payments and outstanding invoices.
Predefined letters and SMS recovery campaigns: Such a system ensures fast, easy and standardized communication, using customized and defined templates to serve different purposes.
Customized business processes: Usually, the recovery process activities are organized in steps. Each case requires the existence of at least one step and each step requires, at least one action to be fulfilled. The execution and completion of an action is adapted to the company’s business needs and involves tracking a secure workflow, helping thus to train new employees, maintain the temporary staff organized and administrate the registered cases efficiently.
Easy to find data: The recovery department representatives have easy access to information on outstanding accounts, clients’ email addresses, phone numbers, etc., with the possibility to associate multiple contacts. It also contains data about the types of loans or debts and actions on the customer’s account. Such a system helps you to be continuously informed and updated.
Multi- currency: It records payments, takes over bills and identifies debts in real time. Due to the multi-currency platform and legal currency equalization, a collection system provides business with global partners and foreign agencies.
Documents and comments management: It stores and publishes documents for an easy and fast support in dealing with cases, without involving the defective paperwork. Comments, attachments, notes or observations can be easily saved or associated, having also the possibility of advanced search options.
- Real time reporting: With the help of a recovery system, the reports are fast and easily generated in various forms. Integrated with managerial analysis tools, the system calculates instantly the performance indicators and generates preconfigured or defined by user reports on the updated invoices, payments, latest activities related to collection files, clients and number of open or closed cases on a certain period of time.
The right choice
The debt recovery industry revolves around 30 million euro, according to e-Finance, and continues to increase along with the credits expansion. According to the same source, the competition is fierce not only on the collection market, but also on the market of software solutions for management and optimization of such processes. Whether it is done internally by specialized departments or there are outsourced services, the debt recovery has now an advanced technical support.
Whether they are online, offline, under SaaS (Software as a Service) regime or implemented in-house, the collection type systems can be used completely in the debt recovery process, from the identification of outstanding bills, legal file management, recovery of unpaid property up to the management of the to re-selling process of the stock obtained after recovery. Thus the investment is recovered quickly.
Generally, implementing such a system requires a very short time, all depending on the complexity of companies or recovery agencies business processes.