Business owners or managers of merchant cash advance companies understand how challenging dealing with delinquent customers who consistently fail to pay their advances can be.
Late payments can harm your business’ long-term health and harm your ability to invest further in your business. When all of your in-house debt recovery solutions aren’t working, it is essential to consider hiring a third party debt collection agency, knowledgeable in the merchant cash advance space and with experienced debt collection lawyers on staff.
However, with a saturated industry filled with ethical concerns, finding the right agency that aligns with your values requires careful research.
Here are five vital tips on how to hire a cash advance debt collection agency:
Step 1: Check out their credentials and legal compliance.
The first and most crucial step is to ensure that the debt collection agency complies with all federal and state laws related to debt recovery, and that they have deep and proven experience in your field. Doing this maximizes the chances of a successful recovery, and working with an agency that has experienced debt collection lawyers on staff can offer reassurance that they follow legal guidelines, and verifies that the agency holds the proper licenses as a debt collection agency.
Related: Debt Collection Lawyer or Agency: Which One to Choose?
Step 2: Evaluate the Fee Structure.
Consider the agency’s fee structure and determine if it fits within your budget. Many agencies use a percentage-based fee structure, where their payment depends on the amount of money they recover from delinquent customers, while others employ a flat fee model. It’s vital to inquire about the fee arrangement and ensure it is affordable for your business.
Step 3: Research, References and Requests
Before making a final decision, it’s important to do your due diligence. Ask the agency for references from other businesses that have used their services. Seek references from businesses in a similar industry and with comparable needs to yours, and this will help you assess the agency’s reputation and ability to deliver results. Don’t hesitate to ask the agency various questions before hiring them. Inquire about their debt collection strategies, years of experience in the industry, and success rate. Additionally, ask about their customer service policies and if any complaints have been filed against them.
Related: How To Hire A Debt Collection Agency
Step 5: Review the Contract Thoroughly.
Carefully read and understand all terms and conditions before signing a contract with the debt collection agency. Ensure you are comfortable with the payment structure, timeline, and any other stipulations outlined in the contract.
Following these steps will help you find the right cash advance debt collection agency to suit your business needs, and help you successfully recover the funds you’re owed.
Related: Working with a B2B Debt Collector in 2023: What You Need to Know
We’re happy you found this article informative! Go back to our blog page to find more tips, tricks and guidance on collections, to ensure your business gets paid.
If you have unpaid cash advance invoices that need to be recovered, commercial debt collection may be a good option for your business. A commercial debt collection agency can help you with the process of recovering past-due accounts and provide guidance on best practices for managing accounts receivable.
Led by a team of experienced commercial debt collection attorneys, Monetaria Group has helped hundreds of businesses recover and collect their outstanding debts and payments. Schedule a FREE consultation with our expert team to see how we can help you recover your money today!