How can you recognize a reliable debt collection agency?

Sooner or later, every entrepreneur experiences it: a client does not pay their invoice. In many cases, the client has simply forgotten, and a simple reminder ensures they pay. But if the invoice remains open even after one or more reminders, the invoice is considered overdue, and measures can be taken.

For instance, a collection agency can be engaged to collect the invoice. A collection agency specializes in collecting unpaid invoices and will contact the client on behalf of the principal. But how do you know if you are dealing with a reliable collection agency?

Various indicators

There are various indicators to recognize a reliable collection agency. Each indicator can say something about the professionalism, reliability, and quality of the service provider. Examples of important quality indicators for collection agencies include:

• NVI Collection Quality Mark (Incassokeurmerk)
• Collection Register of the Wki
• ISO certifications
• AFM license

Quality Mark for collection agencies

To make the quality of a collection agency measurable, the Dutch Association of Certified Collection Companies (NVI) has developed a special quality mark. Only collection agencies that meet the strict standards receive the Collection Quality Mark. The quality mark was created to help companies find a reliable collection agency. Every two years, an independent party conducts an audit to see if the company meets all requirements and standards.

Among other things, they examine:

• Working methods and protocols
• Ethics and integrity
• Transparency
• Complaint handling
• Financial stability and reliability
• Handling and safeguarding client funds

Collection Register: Debt Collection Quality Act (Wki)

Since April 1, 2024, the Debt Collection Quality Act (Wki) has been in effect. This law sets requirements for collection agencies to guarantee the quality of their services and to better protect consumers. Part of the law is a mandatory collection register, in which all collection service providers must register. Only agencies that meet the established requirements are included in this public register. By checking whether a collection agency is listed in the collection register at Justis (part of the Ministry of Justice and Security), you can verify whether the agency is legally authorized to provide collection services.

Note: The absence of this registration means that the agency is effectively not permitted to be active in the amicable collection process.

Other certifications and licenses

In addition to the NVI Collection Quality Mark, there are more certifications that say something about the quality of a collection agency. First, there are international standards for business operations. These ISO (International Organization for Standardization) standards come in various types and are indicated by a number. The various ISO standards show to what extent an organization follows various internal processes and protocols. ISO certification trajectories such as ISO 9001 (quality management) and ISO 27001 (information security) are no longer a luxury for more and more collection service providers, but a necessity.

Additionally, there are licenses in the field of financial management. For instance, it may be necessary to have specific licenses for certain claims. Claims that fall under the Financial Supervision Act (WFT) may only be handled by a collection agency with an AFM license (Authority for the Financial Markets).

Experience and expertise

It is important to choose a collection party with experience in collecting claims. Collection is a delicate process, and it is vital that it is handled properly. A collection agency with a proven track record knows exactly how to approach your debtor and how to maximize the chance of a successful collection.

Moreover, it can help if a collection agency has experience within your industry. They better understand the nature of the client relationship, what is standard in terms of payment behavior, and which communication style works best.

Transparent working method

It is important that you choose a collection agency with a transparent working method. This ensures you know exactly where you stand and avoids surprises. Unfortunately, not every party is equally transparent about rates. Unexpected costs or commissions can appear. Even with No Cure No Pay agreements, it is important to check the fine print beforehand, as terms can differ significantly per provider.

Furthermore, it is important that the collection agency is clear about how it intends to approach your debtor. This allows you to ensure that your debtor is urged to pay in a respectful manner.

Service and accessibility

The collection agency must be easily accessible for principals and debtors. Payment arrears can have a major impact on both parties, and it is important that a professional collection agency can reach a sustainable solution. Good service and expert advice for the principal are essential. Additionally, debtors must be given the space to tell their side and have sufficient opportunities to pay off their debts.

Success rate

Besides professional protocols, methods, and service, the success rate of a collection agency can reveal a lot. The success rate is the percentage of all claims that are ultimately paid. A good collection agency will normally achieve better success scores than a collection firm with amateurish collection trajectories. A good collection score can thus be an indication of the quality and reliability of the collection agency.

Conclusion

For a smart and decisive collection process, it is important that you engage a reliable collection partner. This article outlines several important points you can look for when you want to engage a collection agency.

At incasso.nl, your claims are handled by the collection specialists of Ultimoo. Ultimoo Incasso holds the NVI Collection Quality Mark, is officially registered in the collection register, is ISO-certified, and holds the AFM license. With a track record of over 27 years, we know exactly how to approach your client for the best result. Partly thanks to our personal approach, over 90% of payment arrears are resolved without the intervention of a judge. This saves you and your client many (unnecessary) costs. Moreover, incasso.nl costs principals nothing at all. You run no risk whatsoever.

Create a free incasso.nl account today and put our collection specialists to work immediately!