You have decided to get involved in the accounts receivable collections industry. You see the opportunities available, you negotiate well and you know how it helps small businesses so you have decided to give a go. Once you have made the plunge, you will be ready to make your first collection and your response will probably be “OK, now what?”. Here are five accounts receivable (AR) billing tips to begin collecting payments.
1. Adhere to the corporate policy and procedures. If you are a new agent with an established collection agency, learn and follow their procedures to the letter. An established agency will have put together processes that are compliant with the rules that regulate the collections industry. If you are opening a new agency, then take as much training as you can before you get started in order to ensure you are operating in a fully compliant manner. A good start is to visit the websites of the Consumer Financial Protection Bureau and the Telephone Consumer Protection Act to begin to learn the rules and regulations.
2. Understand and comply with the Consumer Financial Protection Bureau (CFPB) and Telephone Consumer Protection Act (TCPA) regulations for outreach. There are strict and specific means to reach out to the consumer as dictated by these acts and organizations. The rules are very clear in terms of who you can speak with, what you can say, what information you can collect and how frequently you can contact them. Adherence to these rules is imperative. Complaints to the CFPB about your behavior toward the consumer can result in an investigation which can result in fines and penalties.
Another important part of this is to make sure you keep up on any changes that happen with the CFPB and TCPA rules as well as rules within the individual states. For example, Massachusetts recently changed their telephone contact rules and stated that any phone call, even a call in which nobody was contacted or message left, is considered a “contact”. Unawareness and subsequent non-compliance with this regulation could result in fines and penalties for the agency.
3. Be courteous and cordial in all contact with the consumer. Never be rude, angry or threatening during the conversation. There are many different reasons that could cause them to not pay the bill and you do not know what they are. Set the consumer at ease by listening and discussing the situation in an open and friendly manner. Be ready to work out payment programs that are acceptable for both you and the consumer. Being rude and threatening will get you nothing except an investigation by the CFPB.
4. A good accounts receivable management system offers a variety of payment options to the consumer. The more flexibility the consumer feels they have, the more likely they are to make the payments in a timely manner. Offering the consumer the ability to pay with a credit card, debit card or bank transfer, as well as online or through their mobile device, will give the consumer more confidence in their ability to pay the debt because they have a variety of interchangeable methods to do so.
5. Be ready to communicate with the consumer at all times. There will occasionally be times when the consumer needs to discuss changes with you. Be ready to talk with them and work out something if there is a drastic change that needs addressing.
Remember: the AR billing and collections industry is one of the most highly-regulated industries in the world. Compliance with the regulations is critical and good communications are important to collect the maximum amount of dollars from the consumer. Invest the time to build your professionalism and you will be rewarded with a successful business.
For more than a decade, BillingTree has been committed to understanding the marketplace and growing payments with technology, to help clients grow their business. To learn more about how BillingTree can help you, contact BillingTree or call us at 877-424-5587.