Username:   Remember Me
Password:  

Uber Articles {Über (ger) adj. above, beyond }

- Above and Beyond a Mere Article Directory

 
 

A Brief Assessment Of The Debt Collection Strategies

By Lela Perkins

Business ventures demands a substantial amount of capital. The huge demand of capital investments in the commercial undertakings calls for strict debt collection strategies for the loaners to get money loaned. Most organizations have a number of obligations to settle and loan repayment happens to be the last of their worries. Some of these organizations may even end up defaulting on the loans resulting in the debt collection strategies.

Governments encourage large financial bodies to advance capital to enterprises indiscriminately. This is so as to boost economic growth through the multiplier effect. In return, they are rewarded in form of high interests on the loans. High interests have an effect on the debtors. Since the commercial operations are yet to pick up, the interest payments could be defaulted.

To begin with, detailed loan repayment reminders could be sent to the debtors. This acts as a way of remanding them of the solemn duty to settle the financial obligations. Companies with high liquidity often respond positively by settling their repayments timely. Firms with low levels of liquidity often find it hard to settle the obligations in time. Since these organizations have a more pressing need to fight for survival, the remainders are not often fruitful.

At this stage, other channels of cash recovery have to be put in place. The next course of action to take involves making calls to the debtors reminding them of their obligations. This ends up instilling fear in some of them. As a result, some amounts could be settled. There is a special group of struggling firms that do not make good of the frequent warnings.

As despair and the reality of the hurdles involved in asking its money back, the company results to other methods in a bid to ask for their money. More often than not, such bodies result to making the first call demanding for their money back after their emails and other communication modes go unattended to. Usually, this approach symbolizes a strain in the relationship between the parties involves. Further business relations in the future are usually unlikely.

The second type of a reminder often follows if the first few calls goes unattended to. This may take one to two weeks to send this reminder. It could take the nature of a personalized email to the top management of the firms in question. The tone of the emails gets harsher in order to underline the seriousness of the matter at hand. At this stage, a number of debts are settled albeit late. A crisis meeting between the directors of the entities could also be necessary if the amounts owed are substantial.

By now, most of the debt recovery plans are exhausted. This leaves the financial organizations with few options. However, it is still necessary for them to claim what is rightfully and legally theirs. Legal notices are issued to debtors. The company lawyers draft these notices outlining the new terms and conditions of repayments. The effect of legal notices and the proceedings on the company brand names and trademarks has to be assessed.

The laid down measures are seen as debt collection strategies. These are necessary for companies to claim what they believe is legally and rightfully theirs. In most cases, the results of using such strategies are incredible. Companies are recommended to integrate the strategies into their operations so as to reduce the cases of loan defaulting.

Read more about A Quick Analysis Of Debt Collection Strategies visiting our website.

Article kindly provided by UberArticles.com

Topics: Debt Consolidation | Comments Off

Tags: , , , , , , ,


Article Citation
MLA Style Citation:
Perkins, Lela "A Brief Assessment Of The Debt Collection Strategies." A Brief Assessment Of The Debt Collection Strategies. 17 Apr. 2014. uberarticles.com. 21 Jul 2014 <http://uberarticles.com/finance/debt-consolidation/a-brief-assessment-of-the-debt-collection-strategies/>.

APA Style Citation:
Perkins, L (2014, April 17). A Brief Assessment Of The Debt Collection Strategies. Retrieved July 21, 2014, from http://uberarticles.com/finance/debt-consolidation/a-brief-assessment-of-the-debt-collection-strategies/

Chicago Style Citation:
Perkins, Lela "A Brief Assessment Of The Debt Collection Strategies" uberarticles.com. http://uberarticles.com/finance/debt-consolidation/a-brief-assessment-of-the-debt-collection-strategies/


Reprint Rights

Creative Commons License
This article is subject to a revocable license under a Creative Commons Attribution-No Derivative Works 3.0 Unported License, which means you may freely reprint it, in its entirety, provided you include the author's resource box along with LIVE VISIBLE links (without "nofollow" tags). We may revoke the license at any time with or without cause. You must also include the credit to UberArticles.com.

Comments are closed.

Disclaimer
Uber Articles and its partner sites cannot be held responsible for either the content nor the originality of any articles. If you believe the article has been stolen from you without your permission, please contact us and we will remove it immediately. If you have a problem with the accuracy or otherwise of the content of an article, please contact the author, not us! Also, please remember that any opinions and ideas presented in any of the articles are those of the author and cannot be taken to represent the opinions of Uber Articles. All articles are provided for informational purposes only. None of them should be relied upon for medical, psychological, financial, legal, or other professional advice. If you need professional advice, see a professional. We cannot be held responsible for any use or misuse you make of the articles, nor can we be held responsible for any claims for earnings, cures, or other results that the article might make.
  • RSS Feed

    RSS for Debt Consolidation