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Debt Collector

Debt collectors reclaim money owed to an organisation by businesses or individuals.

They pursue debts of all sizes, from thousands of pounds owed by a business to smaller amounts owed by individuals to credit card companies, phone and energy companies, finance companies or mail order catalogues.

The debt collection process usually follows a series of steps:

  • First, the debtor (the person or business that owes the money) is contacted by letter or telephone.
  • If no solution is reached, the debt collector may visit the debtor in person.
  • If the debt is still not paid, the matter might be taken to a solicitor and could be brought to court.

Commercial debt collectors usually work normal office hours, Monday to Friday. They may need to work extra hours at times to meet monthly targets for collections.

In the consumer sector, debt collection hours are generally 8.00am to 9.00pm, Monday to Saturday. Debt collectors are likely to work on a shift system or on a flexible basis within these hours. Part-time work is common.

Most debt collectors are office based. Field agents, who visit debtors at home or work, are often self-employed and may use their own home as a base.

Salaries range from around £14,000 to £35,000 or more. There may be target-related bonuses on top of the basic salary.

A debt collector needs:

  • excellent communication skills
  • the right balance of tact, empathy and assertiveness
  • the ability to negotiate and reach solutions about how debts can be paid
  • numeracy and IT skills
  • determination and persistence
  • a knowledge of consumer and credit law
  • an interest in the financial and credit industries.

The main employers are large banks, retailers and other organisations that have in-house debt collection teams, and debt collection agencies, which are contracted by organisations to pursue their debts.

There are no minimum qualifications for this work. Some employers, however, may look for GCSEs (A*-C) in English and maths. Enthusiasm and good interpersonal skills are also important.

Debt collectors may study for professional qualifications and take short courses in specific areas of debt collection.

With experience, debt collectors may be promoted to lead a small team. There may be opportunities to progress into a management role or to become a director in a collection agency. Debt collectors may move into other areas of finance. Some become self-employed.

What is the work like?

Debt collectors reclaim money owed to an organisation by businesses or individuals.

They pursue debts of all sizes, from thousands of pounds owed by a business to smaller amounts owed by individuals to credit card companies, phone and energy companies, finance companies or mail order catalogues.

The debt collection process usually follows a series of steps:

  • First, the debtor (the person or business that owes the money) is contacted by letter or telephone.
  • If no solution is reached, the debt collector may visit the debtor in person.
  • If the debt is still not paid, the matter might be taken to a solicitor and could be brought to court.

Debt collectors may specialise in a particular aspect of the collections process:

  • Consumer debt collection - collecting debts owed by individuals. This could be over the phone from an office, or by visiting the debtor's home or business (known as field collection).
  • Commercial debt collection - pursuing business debts, usually by letter and phone rather than through personal visits.
  • International collection - working for foreign creditors to collect debts in the UK or for UK companies wanting to collect overseas debts.
  • Legal collection - handling debt that has passed into the legal recovery stage.
  • Debtor tracing - trying to locate debtors who have moved or who cannot be contacted.

A debt collector may:

  • ask debtors to settle their debts
  • find out why the debt has not been paid
  • negotiate with debtors who are in financial difficulties to work out a realistic way for them to settle their debt, for example, by agreeing a series of smaller payments over several weeks or months
  • deal with debt collections that have entered the legal system, following strict procedures.

Debt collectors use computer databases to check financial information about individuals and companies. Those working in call-centre environments may use automated dialling systems when calling debtors.

They may work alone or in a team. They usually stay in close contact with the company to whom the money is owed, ensuring that any payment arrangements are acceptable to them.

Hours and environment

Commercial debt collectors usually work normal office hours Monday to Friday. They may need to work extra hours at times to meet monthly targets for collections.

In the consumer sector, debt collection hours are generally 8.00am to 9.00pm, Monday to Saturday. Debt collectors are likely to work on a shift system or on a flexible basis within these hours.

Part-time work is common in this type of job.

Most debt collectors are office based. Field agents, who visit debtors at home or work, are often self-employed and may use their own home as a base. They normally need to have a driving licence and their own car.

Salary and other benefits

These figures are only a guide, as actual rates of pay may vary, depending on the employer and where people live.

  • Salaries may start at around £14,000 a year.
  • Debt collectors with some experience may earn up to £25,000.
  • Self-employed debt collectors with an established business may earn more than £35,000 a year.

Salaries may be made up of target-related bonuses on top of basic salaries.

Skills and personal qualities

A debt collector needs:

  • to be able to communicate well, in person, by telephone and in writing
  • the right balance of tact, empathy and assertiveness
  • the ability to negotiate and reach solutions about how debts can be paid
  • numeracy and IT skills
  • determination and persistence
  • commercial awareness and a strong business sense
  • a knowledge of consumer and credit law, especially if they are involved in legal collections.

Interests

It helps to be interested in:

  • dealing with all kinds of people
  • the financial and credit industries.

Getting in

Around 20,000 people work in debt collection, and opportunities exist throughout the UK. The main employers are:

  • Large banks, retailers and other organisations that have in-house debt collection teams.
  • Debt collection agencies, which are contracted by organisations to pursue their debts. There are around 500 agencies in the UK, of which two thirds are small local operations.

Overdue debt is a constant problem in the commercial world. The amount of consumer debt and the number of people who default on payments is increasing. This has led to more work for the debt collection industry and good opportunities for debt collectors.

Vacancies for debt collectors occur frequently. They may be advertised in local and national newspapers, through recruitment agencies and on company websites.

Entry routes

There are no minimum qualifications for this work. Entrants vary from those with no qualifications to those with a degree. Some employers, however, may prefer applicants who have at least GCSEs (A*-C) in English and maths. Enthusiasm and good interpersonal skills are important. For people seeking to enter international collection, it can be helpful to be fluent in a modern foreign language.

The Diploma in business, administration and finance may be useful for this type of work.

While a degree or a professional qualification is not essential for this work, it may be an advantage for those who want to progress into managerial roles. Several universities offer degree courses with an element of credit management. For a degree, the minimum requirements are usually two A levels and five GCSEs (A*-C), or equivalent qualifications, such as an Advanced Diploma in business, administration and finance. Entry requirements vary, so it is important to check with individual institutions.

Training

Debt collectors normally train on the job. They may attend in-house or external courses covering relevant legal aspects and essential skills in subjects such as telephone techniques and negotiation.

The Institute of Credit Management (ICM) offers professional qualifications for careers in credit control. The ICM Levels 2 and 3 Diplomas in Credit Management are flexible qualifications that cover a wide range of credit management-related areas, including telephone collections and debt recovery. The ICM is developing a Level 4 Diploma and plans to revise the existing Level 5 Diploma.

The Credit Services Association (CSA) offers a City & Guilds-accredited Diploma for the debt collection industry. Study is by distance learning plus attendance at four one-day tutorials in either Manchester or Warwick. To achieve the Diploma, students must pass a written examination.

The CSA also runs a range of courses on aspects of consumer and commercial debt collection. They include areas such as collection methods, negotiation in collections and collection law.

Credit Management Training (CMT) offers a Level 4 Diploma in Credit Management accredited by NCFE. The Diploma course is offered at different venues and lasts five days. Successful candidates are awarded the MACP (Diploma) and first-year membership of the Association of Credit Professionals.

CMT also runs a number of other short courses, including courses on cash collection and DIY legal action for consumer and commercial credit.

Getting on

With experience, debt collectors may be promoted to lead a small team. There may be opportunities to progress into a management role or to become a director in a collection agency.

Debt collectors may move into other areas of finance, such as sales, debt counselling or bailiff work. Some become self-employed and work from home, or set up their own agencies.

Further information

Credit Management Training Ltd (CMT), The Old Surgery, Church Street, Cropwell Bishop, Nottingham NG12 3BY. 0115 989 9997. Website www.cmtltd.co.uk

Credit Services Association (CSA), Wingrove House, Ponteland Road, Newcastle upon Tyne NE5 3AJ. 0191 286 5656. Website: www.csa-uk.com

The Institute of Credit Management (ICM), The Water Mill, Station Road, South Luffenham, Leicestershire LE15 8NB. 01780 722900. Website: www.icm.org.uk

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