There are a lot of great collection agencies serving the needs of businesses all over the country, but there are also some who do not have the best interests of their clients at heart. Here are six things that some collection agencies do not want their clients to know:
1. They’re not licensed in all 50 states
The majority of US states require debt collectors to be licensed in that state in order to collect from its citizens. Many local firms may choose not to make the investment of getting licensed in every state, meaning they could be prohibited from collecting a debt from any of your customers who have skipped town.
2. They are lax on compliance with federal and state laws
Keeping up with all the federal and state laws governing debt collection is an expensive proposition, and one that some firms aren’t willing to invest in. They want to cut costs, and compliance management can often be the first thing to go. But their lack of compliance puts your business at risk.
3. The regulatory landscape is changing
The regulations surrounding debt collection are becoming increasingly complex, and a new agency—the Consumer Financial Protection Bureau, or CFPB—has been created to monitor the industry. If your current agency isn’t keeping you up-to-date on compliance and industry issues like the creation of the CFPB, it’s easy to imagine that they are too busy struggling to keep up with the changes themselves to help you understand the implications for your business.
4. Other agencies provide customized reports and remittance packages
Ignorance is bliss, right? So some collection agencies would have you believe. They don’t want you to know that other agencies will build a customized remittance package to suit your needs, or provide you with reports to help with in-depth analysis of your collections.
5. Their technology is out-of-date
If your current agency is using outdated technology and not making investments in cutting-edge solutions, that should be a big red flag. A lack of investment in the future of their business shows a lack of long-term strategic thinking. In addition, up-to-date technology can only benefit you, giving you online access to progress reports and enabling you to track the results of their collection efforts whenever and wherever you need to.
6. Their data security is lacking
Collection agencies deal with a lot of customer data that contains personally identifiable information such as names, addresses, phone numbers and Social Security numbers. This leads to many important questions:
- How safe is your customers’ data?
- Is the agency’s server room secure?
- How is the data encrypted?
- Do they have data security policies to prevent their employees from walking out with valuable customer information?
- Do they have a disaster recovery plan in place?
If you’re unsure of the answers to these questions—or worse, if the agency isn’t sure—it’s probably time to work with an agency who can guarantee the security of your valuable data.
We invite you to learn more about Fairway’s approach to licensing, compliance, customization, technology and security, and we’d love to answer your questions and have a discussion about how we can help your business. Contact us to start the conversation.