How to best manage debt collection during high inflation
Few Danes have not noticed that supermarket prices are rising, heating bills are going up and electricity bills are skyrocketing. Denmark and the rest of the EU are facing the highest inflation rates since the late 1990s - and it's showing.
Unfortunately, rising inflation can also be seen in Danish businesses, which are slowly reporting a drop in turnover, but are also submitting more debts to lawyers and debt collection agencies.
At Collectia, we as a debt collection company have worked professionally and authorized with debt collection for more than 150 years. During this period, we have experienced several financial downturns in Denmark, and the current one is probably not the last one we will witness.
Our many years of experience have equipped us to deal with most crises - even when they affect our customers and their bad payers - debtors and creditors.
But is there really a difference between debt collection and debt recovery during inflation - and what should you do differently?
In this post, we focus on the topic of 'debt collection during economic crises'.
It remains about respect
Debt collection is fundamentally about respect. On the one hand, there is a creditor who has not been paid for work done or products delivered. In the worst case scenario, this means that the creditor cannot pay its expenses and cannot pay wages to itself or its employees. On the other hand, there is a debtor who may have major challenges in paying his invoice - for many reasons. As a debt collection company, we have the utmost respect for both - even during inflation.
Our primary task is to recover our clients' money while keeping the good customer experience in focus. Our experience clearly shows that respectful recovery promotes payment and maintains good customer relations.
For anyone who has an outstanding debt, it should be easy, fast and safe to pay off their debt. At the same time, it should be possible to get help and advice if you need it. That's why our large support department consists of experienced and empathetic debt counselors who help customers through the process.
Understand your customers' situation
If you do not take into account your customer's situation (financial situation, job situation, etc.), communication can quickly break down. This can quickly block the recovery process, which requires a proper dialog between debtor and creditor.
At Collectia, all our debt collection activities are supported by CAI (Collectia Artificial Intelligence), which is our artificial intelligence that utilizes our vast amounts of debt collection data. In fact, CAI takes into account more than 25 different parameters about each debt relationship and customer type, which it uses to build dynamic recovery trajectories. This results in efficient collections that put the customer at the heart of the process.
In addition to one of Denmark's strongest debt collection processes based on artificial intelligence, our debt advisors are of course ready with personal and professional sparring and advice for both debtors and creditors, so that both parties can move forward debt-free.
Inflation may require new tools in your business
As one of the few debt collection companies in Denmark, we also offer a tool that can minimize the number of debt collection cases for our clients. The tool is called Qatchr - an online platform for those who want a strong credit rating tool.
Via Qatchr, users can credit rate other Danish companies and look up private individuals in our debt register, Debitorlisten.
We offer a free 14-day trial period - with no obligation, of course.
Do you need to protect yourself even better against bad payers during high inflation? Then talk to our advisors for a no-obligation chat about how credit ratings can help you and your business.
