Telephone Collections: Do's and Don'ts

Collections Training Resource
September 6, 2013 — 2,463 views  
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While it is now a routine to use telephone for debt collections, it is noteworthy that telephone collections must be made under the guidelines of the TCPA 1991 which is designed to protect the rights of consumers and to keep them safe from the agents who harass them. A set of rules and regulations define the norms to be followed in such cases.

Laws Pertaining to Telephone Collections 

Telephone collections come under the purview of the TCPA and the FCC. Under the rules and regulations, the solicitors cannot call residences before 8 in the morning and after 9 in the night, local time. In addition, the solicitors are required to maintain a DNC or ‘do not call’ registry. This is the list of consumers who do not want to be called. The DNC request is to be honored for a certain specified number of years.

The DNC registry makes it incumbent upon solicitors not to call for collections. In addition, the solicitors must provide specific information just in case they are calling. This includes not only their names, but also the name of the entity or person on whose representation the telephone collections are being made. In addition, they must provide the address or number on which the entity or the person can be contacted. Also, a recording or artificial voice is prohibited. The violation of the TCPA gives the victim the right to sue for an amount equal to $1,500 or less for each violation.   

Things to Avoid

Most small businesses fail within the first five years primarily because of bad debt or account receivable. While it is important for agencies to recover debt, there are well laid down collections guidelines. These must be scrupulously followed especially when making telephone collections.

When calling the debtor to speak about the account, the agent must identify and explain the reason for calling, tell them when the payment was due and ask when you will receive the payment. Harassment should be avoided, so a polite tone in conversation must be maintained. In case the debtor has not paid, call back in another 15 to 30 days. However, just in case the debtor figures in the DNC registry, the call should be scrupulously avoided.

Demand letters are okay if you are prohibited from calling them. The purpose of successful debt collections is best served in maintaining a harmonious atmosphere so that negotiations can take place. So anything that deviates from the actual debt collection must be avoided.

The Ideal Approach

The ideal approach to telephone collections is to achieve the goal of collections without violating rules and regulations. So, the debtors must be called within the time stipulated. The caller must identify their details. While not taking the excuses made by the debtor at their face value, there is a method in collection without appearing harsh or rude.  

Just in case, a debtor fails to make payment citing one or more excuses, ask them when they can make the payment. The consumer can be pursued till they finally make the payment as answering questions can be difficult for them and there is a limit to which they can stretch the excuses.

The debtor can be engaged in a fruitful discussion in a harmonious manner within the positive setting for the net positive outcome through constructive engagement that may appear time consuming, yet they must be considered an ideal approach. 

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