Common Mistakes in Using Social Media for CollectionsCollections Training Resource
August 20, 2013 — 3,159 views
While many of us may cringe at the thought, debt collections are a very important part of any business. If you own or are a senior manager in any small or large-scale corporation, you will realize how much lost funds through defaulters can harm your company’s potential and ability to grow. A number of companies are turning to social media collections as a way of recouping any funds lost through defaulting customers, but it is important to know when to draw the line.
Using Social Media for Collection
The increase in social media collections is primarily due to the fact that a lot of people have started to devise a number of tactics to avoid debt collectors. The various social media sites available provide the opportunity for a debt collector to get in touch with an unsuspecting defaulter and coax him or her into fulfilling their payment obligations. However, it is also important to make sure that you adhere to the many rules that govern social media collections so as to avoid violating an individual’s rights.
One of the biggest problems that both defaulting customers as well as debt collection agents face when it comes to social media collections is the fact that it is a rather new phenomenon. As a result, there are a number of loopholes and a number of the regulations that govern this tactic are still very loosely defined.
Risk of Using Social Media for Collection
The law is very precise about general tactics used in debt collections, it is essential to make sure that you do not breach these rules. Moreover, it does require a lot of time in order to research the individual being targeted to reclaim a debt. The debt collector might spend hours in order to find out what could be relevant information on the individual, but there still exists only a very small chance of actually being able to retrieve the funds through this practice.
It is essential to remember not to get carried away when using the various social media websites in order to track down the debtor. Just like a credit report is merely a tool for a creditor; in the very same way social media sites are nothing more than a tool to help collect information. It is easy to see why someone would be tempted to use a social media website to get in direct touch with the debtor - but it is essential to avoid doing so. Never use an instant messaging tool to inform a debtor about a debt, nor should you ever send a message or email to a debtor in the event that you feel a third party will be able to see the email. Never request to be added as a ‘friend’ on any social networking site with a debtor.
One of the most common mistakes that people commit when it comes to using social media for collections is the fact that a number of debt collectors will try to initiate contact with the debtor through these websites. These websites allow you to send insecure messages through the mainframes to the debtor - thereby causing you to have disclosed sensitive information about the debtor’s debt in electronic communication that can and may be seen by third party individuals. Since this violates federal law, make it a practice to be safe rather than sorry and avoid sending any emails through these websites.