In finance and loans business, there will be times wherein the debtor will be late in making payments. This will happen more frequently if the country's economy is not stable. Be prepared. Know that this is unavoidable. Read on and learn the common excuses and how to effectively deal with them.
First off, here are some common excuses that debtors use:
Already mailed payment - if it's still within mailing period you can just opt to consider. However, you need to advise the debtors to mail it earlier than usual to avoid late charges. On the first instance of delinquency, don't miss to follow up. Again, be firm with handling past due accounts. They should take into consideration the mailing period when they send the payment the next time.
Provide payment flexibility. Always prioritize the fastest payment methods - Knowing the most common excuses why debtors can't pay and how to deal with them will lead to an effective way of handling these scenarios. Lack of immediate funds due to economic conditions, slow receivables, other causes ' If the account is big then it's time to pay the debtor a visit to check the situation personally. Collection process should be firm yet considerate of any justifiable reasons. Treat this in accordance with your company's policy for payment extensions. Payment enforcement should start as early as day 5. Don't give the debtors the impression that it's fine to pay their bills late. Don't tolerate late payments. Debtors' common excuses are, already mailed the payment; valid claims such as wrong price on the bill or damaged goods; and lack of immediate funds. Make sure you ask for full details on all of these excuses. Through probing, sometimes, you can tell if the debtor is telling the truth or not. With mailed payments advise the mailing period. Make sure they understand that when they mail the payment, they should also take into consideration the time it takes to reach your company. Valid claims should be verified. If proven true, do everything you can to assist the debtor. When the debtor lacks immediate funds, deal with it in accordance with the company's late payment policy. Remember, collection process should be firm, yet considerate of the unforeseen conditions that might have happened to the debtor. We don't want them to think that they can do this again in the future. Once an account turns past due, contact the debtor. A friendly reminder about the bill almost always encourages the person to find ways to pay it.
Genuine reason - All/some of the signing officers are not available ' This shouldn't be the case, but if it's only for a day then you can just bear with it. However if it's for an excessive period then it's time to contact your collections agency or lawyer - be suspicious and investigate thoroughly. This reason is mostly used by debtors to avoid late charges or fishing for credits. If proven true however, do everything you can to help the customer. Statistics show that customers' who have had problems and were assisted well to resolve it are more satisfied that customers who didn't have any issues with the company at all. Handling common excuses of debtors can be quite frustrating at times if you don't have an idea on how to do it. Follow the simple tips mentioned above and you'll be more effective in dealing with these situations. Missed payment should be expected in business. Never overlook a delinquency status even though it's the first time. Treat it with urgency. As early as day 5 contact the customer. Remind them of their past due amount. Better yet, purchase equipment that will automate the task. Add flexibility on your payment methods. Educate the debtor on ways that they can pay their bill and highlight the ones with faster turnaround time. You should at least know how to deal with these scenarios so that you and the debtor could work together to find the best resolution for the problem.
![[Valid RSS feed]](http://www.articlesbacklink.com/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites
