Experts in Debt-Recovery.
Specialist Advisors on Credit and Distressed Debt

The evolution of debt recovery: To a more customer centric approach

Debt collectors: big burly men that came knocking on doors in the dead of night for money owed, with the threat of a beating (or worse) held over debtors’ heads as an incentive for them to pay up.

Thankfully, times have changed, and today’s collectors are nothing like the brutes of decades gone by. Which is good news for me, as I am neither big nor burly, and would much rather break bread with debtors than break anything else!

But these age-old practices certainly made an impact, not only on the debtors in their day, but on the perception the public would have of debtors and debt collectors for centuries to come.

In 18th century America, for example, the law in every state, as had been the case in England for the past 300 years, allowed for debtors to be imprisoned under horrendous conditions. This prompted Pennsylvanian Governor, Thomas Mifflin, to conclude that being a debtor seemed to be more offensive to society than being a vicious criminal.

Time has helped reduce some of the stigma surrounding debtors, but has not been as kind to debt collectors. Many people still believe collections agencies are the bull terriers of the financial sector, and are unrelenting in their pursuit to recover money owed.

That is a very real perception in our industry. Just ask my wife – every time someone asks her what I do, she smiles and says that I work in financial services!

This is also evident in all the regulation that is being put in place to govern the collections industry. Although a lot of it is justified when you look at some of the recent behaviour of a small minority of rogue players in the industry.

The reality is, debt collection has come a long way since public floggings and imprisonment, and the focus in our industry today is not only recovering debt, but positively rehabilitating debtors and through this, ensuring an ongoing relationship between themselves and their creditors.

This is an idea that I’m passionate about, and is a philosophy that has informed Debt-IN’s approach to debt recovery. I truly believe small things become great when done with heart.

As the South African economy continues to navigate troubled waters, so the need to destigmatise the status of both debtors and debt collection agencies gains momentum.

There is an opportunity now to work with debtors and sustain their trust, so when the recession loosens its grip, you haven’t just recovered your outstanding funds, but maintained customer loyalty and nurtured clients for life.

In closing, I want to wish you a peaceful and restful close to 2015 and I hope that 2016 is a year filled with happiness, joy and prosperity for all of us.

Mark Essey