Every bank and financial institution is willing to provide loans for ‘eligible’ people. One can obtain vehicle loan, mortgage loan, housing loan educational loans and even personal loans easily depending on their income. Based on certain conditions the loans are sanctioned . Then the chore of collecting Equated Monthly Installments( EMI) becomes a issue if the individual is not paying the EMIs. Time and again we find that there are defaulters. And the outcome in balance sheet will be affected due to non collection of loan amounts. Here is where Outsourcing of Collections comes into picture.
Thus the lenders now can benefit from the services of ‘collection agencies’ who provide the necessary manpower and resources. The lender need not disclose all the particulars of the loan account holder to the collection agent.They may inform the address details, and the amount to be collected. The collection agents work in shift patterns which includes late evenings and Saturdays, as most of the defaulters claim to be busy otherwise. Usually the collection agents gets in touch with the loan account holder over phone daily .They also gather mail details of past-due notices and send personalized collections mails on behalf of the lender. They provide the lenders with monthly status updates and D.T.R (delinquency trend reports)
Collection agencies’ can even provide a tailor-made collection program depending on the lender’s business reputation, social factors , and collection criteria
Who can use Collection Agents:
1. Insurance companies
2. Automobile seller / dealers
3. Any ticketing company
4. Travel agents who book tickets on flexible booking provisions.
5. Banks and financial institution offering loans
6. Telecom Service providers
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