Kuali Financial System

AR Collection Strategies

Here are some tips to optimize the collection process:
  • Commit to collection efforts - Perform the collection effort regularly, not just "when you have time"
  • Understand the law - Understand terminology pertinent to collection, including bankruptcy. If the customer historically has collection problems, they are probably familiar with associated terminology and applicable laws. As a result, they may test you to see how much you know, and to see if they can stall for more time.
    • Make phone calls - Calling customers to discuss collections is fast and personal. In order to be effective, adhere to the following:
      • Speak clearly
      • Use appropriate tone - If your voice is wavering, the customer may think he/she can manipulate you.
      • Control your voice volume - Remain calm, especially if the discussion becomes heated.
      • Be polite and don't accuse - It's possible the payment was lost in the mail, or perhaps the customer just forgot. Give the customer a chance to explain their situation.
      • Consider the customer's history - If they've purchased from you before, have they paid on time or have they chronically paid late? If this is the first time they've been late, there's a good chance the customer simply overlooked the payment and will pay promptly.
      • Aim for a commitment, and be firm - Ideally, the customer will give you a date by which they will send payment. If the customer thinks they'll be able to make payment by a certain date, tell them you will call again before that date to confirm. If the customer initially doesn't commit, remind them that the bill is overdue and that you would really like to help them resolve the debt without having to refer their account to a collection agency.
      • Call before the due date - This applies to customers who have previously paid late, and to those who have committed to a date that is coming up.

Using a Collection Agency

Collection agencies are in the business of extracting payments from individuals or corporations that have not paid voluntarily. As such, their tactics may seem gruff at times, but generally speaking it is best to permit the agency to work their accounts while avoiding the temptation to intervene on a customer’s behalf. Of course, there is no excuse for abusing a customer, and if you feel one of UCD’s collection agencies is acting unprofessionally towards one of your customers, you should let Student Accounting know right away.

Customers with debts in collection still have rights. These rights are enumerated by the Fair Debt Collection Practices Act.

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