Negotiating the Terms of Interest Payments

For current conditions, should be prepared to negotiate the terms of interest payments, refinance and even the hard but necessary decisions to resort to judicial collection. If your company has a customer base will surely these basic operating cycle, ie, buy on credit, paying bills, again use credit. How to improve collection. Before that, please answer the following questions: I have an old report of balances in arrears? I have a report of recent efforts made in the charge for each customer? There is documentation by the client in the portfolio? Date? I have a clear procedure to my collection managers on actions to take according to the delay of the customer? I have trained properly to my computer collection? I have tools and systems for tracking customer base? I have clear plans for cases that ask customers to negotiate limits and default interest? I have established the procedure to follow if a client provides a single payment and requests to be exempt interest? I have segmented the customers to which I no longer want to continue doing business with them? I have already selected a law firm for cases that merit judicial recovery move? Now, the key steps in the management of Collection: Identify the problem of delinquency cases: 90 days past due or more (depending on your politics). Get a list of these recent cases indicate efforts made and actions taken on behalf of its management fee.

Where a mass of 120 days, prepare the relevant communications to each client, to transfer him to judicial collection. Move to cases that merit judicial recovery. Determine doubtful cases, make the necessary reserves and pour it into bad debt. (Keep files and periodically monitor these cases, does not mean discarding). Additionally. Check that each count charging manager with the right tools: telephone, Internet access, fax and messaging. Expect a collector – courier, for collection and recovery efforts.

(According to trading volume and size of its customer base) Monitoring: – Review customer base every 3 days. – Sending dunning in within 5-7 days prior to transfer to legal fee – Steps taken by e-mail – Contact by mail or e-mail to more than one level within the client. – Weekly Report of the state of the portfolio. – Train staff in collection management. Keep up to date. – Do not neglect the hours they can contact customers (you may need night time recovery) as documenting a refinance: Prepare a small contract Attach a note for the amount to refinance. If possible, obtain post-dated checks. Set term interest rate in line with market levels. Conclusions You may decide not to give more credit, however this is difficult because this is how the market is demanding, it is important to better credit, investigate and document customers the best. In the Accounts Receivable is the actual operation, recover and make it work again is the turn of affairs, so the credit and collection area must be trained and supervised. The proper management and administration in the management of their accounts receivables is equivalent to saying proper management of your cash.

| October 16th, 2010 | Posted in General |

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