Debt Collection Agencies Overview: Debt collection agencies are hired by banks and other lending institutions to recoup payments on loans that have gone in arrears. They also are hired by various other providers of expensive goods and services (notably hospitals) to collect on large bills that have gone unpaid.
Debt Collection Careers: The core employees of debt collection agencies are collection agents, usually phone representatives who call debtors with demands for payment. In some cases, these phone representatives may be given limited authority to negotiate terms with debtors. In all cases, the position requires, or can help develop, sales and marketing skills.
Debt collection agencies also employ back office staffs involved in areas such as:
• Relationship management with creditors
• Receiving and tracking payments
• Setting parameters for negotiating with debtors
Billing: Debt collection agencies typically are paid on a commission basis, retaining a portion of the funds that they collect on behalf of the creditor. Individual collection agents themselves may be compensated either on a commission basis, or on a salary plus bonus formula, with the bonus tied to collections.
Debt Collection Agencies Outlook: According to a study by the research firm IbisWorld released in November, 2008, the aggregate revenues of debt collection agencies will be approximately $14.3 billion in 2008, nearly double the 1997 figure and growing to a projected $17.8 billion in 2014.
An improving economy should result in fewer new cases of borrowers falling into arrears on their loans, but opportunities for debt collection agencies may increase, nonetheless, since debts formerly considered uncollectable may then become recoverable, as the borrowers’ financial situations improve.
Article Source: Mark Kolakowski – www.about.com
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