Things Companies Should Never Say To Debtors

Collecting overdue debt from your customer can be a sensitive process. On one hand, your company likely desperately needs the overdue funds to stay functional. On the other hand, you cannot push or urge customers too much.

Saying the wrong thing could end up with a terrible mess in the form of lawsuits, regulatory penalties, or even damage to your business reputation. 

Let’s take a look at some things to never say to your debtors when you are busy trying to get them to pay up.

Don’t Threat or Intimidate Debtors

The debt collection process can be frustrating, but conversations with your customers should never end in threats. Telling your customers that they will be arrested if they don’t pay up or that you will come to their house to collect the due amount is a horrible idea. These threats of violence or aggression are illegal in Victoria and could land your business in a lot of trouble.

Don’t Make False Statements

Threats and intimidation are often paired with false statements. Statements like “your credit will be ruined” or “you will go to jail if you don’t make a payment” are wrong because the creditor just doesn’t have the authority for such actions. This doesn’t just ruin the relationship between client and business, it can also affect the credibility or reputation of your own company because the client will know that your company isn’t honest. These false statements also don’t fall within local debt collection practice acts.

Publicly Shaming Clients

The worst thing companies can do is go public with the situation or inform family members or other clients about the financial situation of your debtor. Sharing personal information about overdue accounts is a privacy violation. This type of violation can cause a lot of damage to your company since other clients will be afraid to make use of your services. Creditors can also file lawsuits against your company for violating their privacy or for defamation.

Don’t Harass Debtors

Harassing your debtors to get them to pay up quicker is also a bad idea. It is perfectly fine to reach out and contact clients about their overdue accounts. However, this type of contact should be kept within respectful boundaries and according to debt collection regulations. If you are constantly calling debtors, sending messages, and bombarding them with account statements, you are violating the local debt collection regulations, and it can be viewed as harassment.

Misrepresenting Legal Action

Companies should be honest with everything they do, including the steps they take. Telling clients that you have already filed a lawsuit against them or that they will soon be evicted is a horrible idea. These misleading or false statements tend to ruin relationships and can make the client feel like they are being abused.

What to Do Instead

Instead of threatening customers and saying the wrong thing, it is best to try your best to handle all debtors legally, respectfully, and professionally, all while staying within local debt collection regulations.

 If you have a tough time maintaining a professional front or are not sure what your legal limitations are, then it is best to hand over your debtors to Vic Collect. Our Victorian debt collection company will take over the communication with the debtor and will ensure that any and every form of communication will be done with the highest level of integrity and respect.

With Vic Collect, you are much more likely to get your due payments, and a positive relationship will be maintained with the customer, so you can enjoy further support from the customer when their financial status starts improving.