Debt recovery is a crucial activity that helps businesses maintain stable financial operations. However, due to a lack of necessary skills and expertise, many companies struggle to conduct debt recovery professionally. In the following article, TNTP’s lawyer will offer a perspective and provide businesses with effective skills and expertise in debt recovery.
1. Negotiation Skills
Negotiation involves influencing the debtor through behavior and speech in order to reach a beneficial agreement for the business. It comprises various skills such as communication, bargaining, and persuasion. Negotiation skills are essential for debt recovery employees to learn and develop during the resolution process.
A debt recovery employee proficient in negotiation skills will easily handle debts, as they understand the debtor’s problems and can offer choices and solutions that ensure the interests of both debtor and creditor. This ensures successful and timely debt recovery, thereby avoiding additional time and costs.
However, this is a challenging skill and only effective when the debtor still has financial capacity and is willing to pay. If the debtor is uncooperative or unable to pay, the business should implement other necessary measures to ensure debt recovery.
2. Persistence in Pursuing the Case
Successful debt recovery also requires persistence, especially for high-value debts and uncooperative or financially incapable debtors. This task can be difficult and time-consuming
Therefore, persistence and determination in pursuing the case are essential skills. This involves closely monitoring activities and continuously contacting to understand the debtor’s situation, attitude, and payment ability; or relentlessly seeking new solutions when previous ones become unfeasible.
While persistence is crucial for effective debt recovery, it should have limits to ensure greater benefits than the costs incurred, as not all debts are recoverable, and continued efforts may lead to waste of time and money for the business and the person conducting the recovery.
3. Legal Knowledge
This is a mandatory aspect that all social activities must adhere to, not just debt recovery. However, many entities conducting debt recovery have used illegal methods, even constituting criminal offenses, making the process unseemly and legally risky.
Therefore, to effectively conduct debt recovery and avoid legal risks, employees must have legal knowledge and thoroughly understand the regulations related to anticipated debt recovery activities to ensure compliance with the law.
Debt recovery aims to protect the business’s interests, requiring the person conducting it to ensure honesty and steadfastness in protecting the business’s interests regarding the debt. If the employee is dishonest, inaccurately reports activities, or covers for the debtor, causing difficulties in recovery or making the business believe the debt is irrecoverable, it results in significant losses. Once trust is lost, it cannot be regained, making honesty in all activities critically important for a debt recovery employee.
This article by a TNTP lawyer discusses ” Skills and expertise in debt recovery” We hope this article brings value to the activities of businesses.