E&O insurance covers the collection agency from consumer complaints of improper conduct, such as harassment. But its members also manage more than 750,000 commercial accounts. Small business owners have to consider many elements when shopping for a collection agency. Product and service reviews are conducted independently by our editorial team, but we sometimes make money when you click on links. Han pointed to Prestige's affordable commission rates as a reason for using Prestige for its collection needs. Debt collection agencies collect delinquent debts of all types: credit card, medical, automobile loans, personal loans, business, student loans, and even unpaid utility and cell phone bills. The biggest disadvantage is the cost. Collectively they recover more than £400m every year including on behalf of many small businesses. It depends on your needs, the agency's strengths, its reputation, and its track record. If you are too aggressive or use questionable tactics, you could face legal action from the debtor. Debt collection agencies are versatile and they collect all forms of debts like credit card debt, medical debt, automobile loan debt, personal loan debt, unpaid utility bills et al. If you are still unsure, think about how the customer responded in the past to your efforts. Here is a full list of collection agencies and a summary of what each company claims to offer. The last thing a business owner wants to do is have an uncomfortable conversation with a customer about an overdue bill. "We look for agencies with a stable operating history and reputation as good as our own. You can't collect on someone if you can't contact to give them a court order. Now collection agencies can contact debtors via text, email and social media messaging apps. It's easy to be lured by the lowest-cost provider when shopping for a collection agency, but if the company uses dubious methods to collect the debt, it can irreparably harm your business. E&O insurance is not required by federal or state laws, but it's a sign of good faith. Summit Account Resolution offers an online portal, transparent fees and tailored strategies. With so many collection agencies vying for companies' business, they have to find ways to stand out. (See our full list of collection agencies and their websites below.). If your customer pays, you keep 100% of the money recovered. If those efforts fail, PSI can send the account to an attorney in the debtor's area to proceed with litigation. https://www.americanprofit.net/, Asset Compliant Solutions – Asset Compliant Solutions is a commercial collection agency that offers standard collection services as well as 45-day delinquent secured collateral loans, unsecured open and revolving lines of credit, and an online portal. https://www.acs-cam.com/collectionÂ, Atradius Collections – Although Atradius Collections is primarily a U.K.-based commercial collection agency, it also has a base in the U.S. Some collection agencies are specialized and will only take on a certain type of debt. Talk to agencies, but also do your due diligence to see how well an agency performs in recouping debts and what its return rate is. Sometimes collection agencies will negotiate with debtors, depending on the arrangement between your business and the agency. Reputation is everything. Debt collection agencies that are members of the CSA already act on behalf of nearly all of the major financial institutions and the public sector in collecting “consumer” debt. https://www.icsystem.com/, Kearns, Brinen & Monaghan Inc. – Based in Greenville, South Carolina, Kearns, Brinen & Monaghan is a full-service commercial debt collection agency serving a variety of industries. When you hire a collection agency, you don't have to deal directly with the customer; the agency handles it for you. Consider your needs, the industries the agency serves and its approach. Sure, there's a fee, but it's better than getting nothing if you don't collect it on your own. Now collection agencies can contact debtors via text, email and social media messaging apps. Contingency fees typically range from 20% to 50% depending on the size of the debt and the age of the delinquent account. To collect a debt, you can give the debt to a collection agency, go to small claims court or go to civil court if the amount is more substantial. For example, you don't have to pay a debt to a collection agency that can't prove you owe them. Agencies typically don't disclose fees on their websites, which means you have to contact them to determine just how much they charge. If they are rude and unprofessional, it hurts your reputation. If Summit AR doesn't collect any money, you don't have to pay. Collection agencies charge fees ranging from 20% to 50% of your collections, depending on how much debt you need help with and how old the debt is. You have less chance of being sued if you hire an accredited and highly rated collection agency. Small businesses do not have rights under the Fair Debt Collection Practices Act. However, some state laws protect businesses, and there are actions you can take to defend your rights. It caters to all commercial accounts and medical billing accounts, using a four-step system to collect funds from debtors. http://rapidrecoverysolutions.com/Â, Revenue Assurance Partners – Revenue Assurance Partners customizes its service to suit your business. According to the Consumer Financial Protection Bureau, 15% of Americans said they were sued by a debt collector. Rates range from 22% to 33%. Massachusetts, for example, banned debt collectors from making collection calls, filing new collection lawsuits, garnishing wages or earnings, or repossessing property and vehicles. However, if you pay a 35% return rate and the agency collects $500, you reclaim $325. They barely have a moment to bill customers, let alone chase down late ones. They may even show up at the debtor's home. It serves various industries, including dental and medical offices, hospitals, schools, property management companies, utilities, retailers, and lending service companies (e.g., credit cards, auto loans and mortgages). You want a company that's a good fit with your business and has good ethical collections practices. The traditional small business collection agency model calls for a no collection, no fee or contingency collection protocol. If they don't, the creditor can either sell the debt to a commercial debt collection agency or sue your business. We selected it based on its decades of experience, transparent pricing and track record of recovering debt. You could still consider hiring an attorney to collect a specific debt. Proper payment of debt collection agencies by small businesses can be done in a myriad of ways. It provides basic collection services like demand letters, calls, and payment reminders, as well as more advanced services, such as first- and third-party accounts receivable management options and skip tracing. https://www.tsico.com/Â, TrueAccord –TrueAccord is focused on collecting consumer debt for small businesses. Collection agencies are only allowed to contact third parties, including family and friends, once and only to locate the debtor. It offers precollections, third-party collections, letter services, litigation, and skip tracing to a variety of industries, including commercial, education, financial, insurance, medical, telecom and utilities. http://nsbi.netÂ, *Prestige Services Inc. – PSI is our choice for the best B2B collection agency. Business owners can tailor their collections with two levels of service and price points that IC System offers. Rocket Receivable has no minimum account balance, zero sign-up fees and no hidden costs. Here's What You Need to Know, 7 Things To Know Before Taking a Case to Court, Reasons a Landlord Can Take a Tenant to Court. As part of our research, we reviewed each agency's website, compared services and prices, and read user reviews. To determine the best collection agencies for small businesses in 2021, we spent dozens of hours researching the top services. It discourages clients from submitting accounts that are two years or older. If you can find the debtor, you may still want to consider small claims court. There's more to it than selecting the cheapest option. As a business owner, look for a collection agency that charges a fair rate, has a documented high success rate in collecting debt, and does so in an ethical and empathetic manner. Summit collects both commercial and consumer debt across the U.S., serving many different industries. Using a collections agency or small claims court should be decided separately for each individual non-paying customer. A collection agency is prohibited from threatening to garnish wages, seize property or employ any legal actions, unless you plan to sue to recover the debt. Debt collectors are more restricted in the actions they can take to collect past-due payments. It provides advanced collection services, such as background investigations, credit analysis, skip tracing, legal services and payment plans. https://www.kaplancollectionagency.com/Â, TSI – This agency provides collection services for commercial, education, financial, government, and healthcare industries for both SMBs and enterprises. You also want to know what tactics the agency employs to recover debt. You don't get all of the money you are owed, because the collection agency takes a percentage for their efforts. Before hiring a collection agency, do as much as possible yourself to try to collect the debt. This agency's website has an online portal where you can log in and monitor the progress of your past-due accounts. http://aspennational.com/collections/Â, Benjamin Michael & Associates Inc. – Benjamin Michael & Associates is based in New York City. A lot has changed for collection agencies since January. Stage Two Contingency Collections is designated for accounts that are more than 120 days late. It can help you with follow-up letters and statements, soft calls, credit reports, and portfolio liquidation services. http://rsdcollects.com/Â, Rozlin Financial Group Inc. – RFGI is our choice for the best B2C collection agency. It's important when comparing collection agencies to pay attention to the return rate. A collection agency is your partner in recovering debt owed to you. 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