How to collect more effectively (part 2)

As what I have said last week, an avid reader of my column sent me an email inquiry regarding some simple tips on how to collect effectively. I was told that she was able to attend one of my collection seminars in Cebu and she is now working as one of telephone collectors aka Tele-collectors for a consumer lending company. I am taking this opportunity of sharing her email and my answer to her so that it could also in a way help other collectors most especially those doing telephone collection that might benefit from this effective collection steps. 

The following is a continuation of the time tested simple steps of an effective telephone collection call:

Fourth, Always Make a Psychological Pause.            In a telephone collection call, it is important for the telephone collector to give the debtor a chance to respond. Two of the most common mistakes a telephone collector makes are either not asking the right question or not giving debtor a chance to respond.  Again, the key to making an effective collection call is to know when to stop talking and wait for the debtor to respond. It is during this portion of the call that the debtor will give you responses such as: (a) the account has been paid already, (b) will promise to pay (PTP), (c) will not be able to pay, or (d) will not pay or simply put, refuse to pay (RTP). This psychological pause is very critical, the telephone collector must be able to determine if the debtor is just stalling, telling a legitimate reason or is just making an outright lie.

Fifth, Determine the problem and isolate the issue. Using information given by debtor or facts gained during the psychological pause, ask questions to further determine why the account is still outstanding and/ or the debtor hasn’t paid. Listen for tell-tales signs, hints, clues that will tell you how to get him to do so. There are instances, where debtors will give you stories to gain advantage. For instance, debtor will tell a sad story to gain sympathy or debtor will make the threat to call the authorities for harassment. A good way to overcome this is to have some sort of a list of excuses, or objections/ stalls and how to handle them. This list could be taken from personal experience or through a workshop.

Sixth, Endeavor to Find the Solution.

To collect effectively, the telephone collector should endeavor to work with, not against the debtor. The collector should maintain control of the conversation and never start or be drawn to any argumentation. If this happens, it will only worsen the possibility of a successful collection and could strengthen debtor’s position not to pay. Sometimes, debtors use this tactic to “test” if they can make the collector angry and/or lose control. Either way it is advantageous to the debtor. Try to work out an arrangement on problem items. As you respond, remember your final objective is payment of the account; not answering each objection the debtor is raising.

Seventh, End with a Firm and Clear Commitment. Upon clarifying the problem and resolving issues, it is a must that debtor to make payment to show good faith. If the debtor is really sincere in his intent, an amount, date of payment(s) and mode of payment should be clear. Ask debtor to write the details down. Ask him if he was able to get your name, address, and phone number. Confirm what has been promised to do and when. Tell the debtor you are doing this as a company policy.

Eight, Update the Files and React Quickly.

Make sure that you note the highlight of the conversation and payment commitment. Of course, when the debtor failed to make the payment, how soon you call the debtor back will make the difference.

For comments, rejoinders and questions related to credit & collection, send email to [email protected].