Common Obstacles Banks Face in Debt Collection and How to Overcome Them

Banks play a crucial role in society. They safeguard people’s money, make lending easier and streamlined, and they help people earn interest. They aren’t like other businesses, and this can cut in two directions.

It’s almost impossible for people in many regions of the world to be without a bank account. Many companies deposit people’s salaries straight into a chequing account, and they’re vital for countless other purposes. However, given how many people have bank accounts but don’t have stable finances, they can run into debt issues.

Here are some of the most common debt collection obstacles banks face and how Summit A*R helps you get the money you’re owed.

Customer Bankruptcy

Once a person or business has declared bankruptcy, banks need to halt their collection process, which can be quite long and complicated. Ideally, banks work something out with their customers before things get to this point.

Summit A*R’s collection services focus on obtaining the largest collection possible for you, but without ever alienating the debtor. We’ll never use harsh, aggressive tactics that the collection industry is sometimes known for, unfairly or fairly, such as late-night calls, robocalls, or threatening language.

Banks don’t want to push customers away or leave a bad taste in their mouths. Taking an ethical debt collection approach helps banks maximize collections without alienating customers, which can be a hard balance to strike.

Summit A*R is proud of our PHD philosophy — Preserve Human Dignity. No matter what the situation or who we’re dealing with, we always treat everybody with kindness and courtesy. It’s a major part of who we are and what we do.

Delinquent Debtors

Banks find it challenging to recover money from defaulting borrowers, and these bad loans add pressure to their capital base and undermine their ability to grow in what’s already a very competitive environment. How do they track down these defaulting debtors without wasting time or money, or diverting bank resources that could be better used elsewhere?

Summit A*R is a debt collection agency with its own in-house fully licensed private investigator, which comes with several benefits. Our skip tracing department has tools that other departments relying on free resources simply don’t have.

Their tools, skills, and experiences make a huge difference. They can find delinquent debtors and their assets sooner, and when they do, they know which buttons to press to make payments forthcoming. By filing reports to the major credit bureaus, making it harder and more expensive for debtors to get loans in the future, they change the debtor’s calculations.

Suddenly, repaying the debt now is cheaper, so the money usually comes forward pretty quickly. Our skip tracing department can locate debtors trying not to be found sooner, saving you money and time.

Customers Have Unexpected Business Problems

Sometimes, bank customers take on substantial loans in the course of their business but then their business runs into problems. As a result, they feel helpless and struggle to pay back any loans.

Unlike in the above example, they don’t declare bankruptcy, but financial repayments can be tough to come by. Summit A*R’s successful debt collection policy involves using trained negotiators who know how to find the best path forward for both parties.

Banks expect the highest return as soon as they can get it. Debtors want to make repayments because the consequences of not doing so can be steep. Our specialists help them find the best middle path. Lest our emphasis on ethical, friendly debt collection seem naïve or optimistic, Summit A*R is proud to collect nearly double the industry average.

Our debt collection specialists are fully licensed, trained, and experienced in what they do. Thankfully, there’s no conflict between treating people kindly and maximizing your financial return.

Banks Collection Efforts Take Time

When customers fail to pay their debt past the due date, banks have almost no choice but to squander time sending past due notices, debt collection letters, request letters, and follow through on them all.

Banks do these things because they don’t want to be left in the lurch, but they all divert time, and therefore money, away from their core operations. If not getting paid in the first place wasn’t bad enough, now, they need to spend more money trying to get what should already be in their accounts. Worse, if the customer gets too annoyed by the messaging, the bank may lose a customer, even if they aren’t the ones who originally caused the situation.

Summit A*R can handle these tasks, so banks don’t waste resources trying to collect debts. We’ll collect more of it, sooner, and all while your relationships in a much better state!

Litigation

Sometimes, when there are no other options available, our full-service litigation program can handle cases where a debtor simply won’t pay up. A licensed private investigator will run a complete financial investigation on the person or entity owing the debt.

If there’s been an insolvency or bankruptcy, further due diligence may be required to decide the next best steps. In other words, we need to determine the likelihood of recovery before sending it to an attorney for final collection.

Usually, the investigation can result in three outcomes. First, that recovery is unlikely, which results in clients not paying anything and the account returning to the collection queue.

Second, we obtain information that helps our collection efforts before going to litigation. Lastly, we recommend litigation, at which point banks can decide if that’s the right step for them. We won’t proceed without full authorization.

We make it a point to gather as much information as we can to either help the usual collection efforts or best support the last option — litigation.

Banks are one of our society’s economic pillars. Banks need to be strong and competitive amid a difficult, shifting world of challenges. Having experienced debt collectors that can recoup challenging debts quickly and without pushing customers away is a major asset. Call Summit A*R today if you want the friendly, ethical debt collectors on your side.