Collection Agency - Know How Soon You Need To Hire One

As a payday lender, I found out the hard way that being a Debt Collector yourself is time consuming, exasperating and often ineffectual. As the owner of 4 loan stores, I wished I had outsourced my loans to a collection agency sooner rather than later. My employees and I had done our level best to collect from our many defaulting customers but, each of us, as a Debt Collector, left a lot to be desired and a lot of un-paid loans on the table. We just didn't have the know-how nor the state of the art software that a Professional Collection Agency has readily available. Also, collecting took a great deal of valuable time away from our other important duties in the stores. And, when I had to hire additional personnel to perform the duties of a Debt Collector, my overhead increased a great deal more than the additional revenue collected.

When our small business expanded into a big business with the increase in popularity of on-line payday loans, our need for a Collection Agency increased exponentially. Once we went on-line, our payday loans soon increased to 2,000 loans per day. Since fraud runs rampant with on-line payday borrowers, who see payday lenders as an easy mark for free money, our default rate skyrocketed and, again, we had to hire more Debt Collector personnel and our overhead, again, increased at a much greater rate than our paid loans.

It was then that I knew for sure that it was time to send those bad loans to a good Collection Agency. Once I did, I realized that I should have done it long ago before my business went from small to big. I had never realized what an advantage a Collection Agency has when it comes to sheer know-how and available databases that the rest of us never dreamed of. Customers that we couldn't track down in 6 months, they found the same day. Our profits increased and our overhead decreased substantially within 30 days. And the decrease in stress was wonderful indeed. I no longer lay awake at night worrying about how we were going to collect all those loans.

My only regret in all of this was that I had not looked into hiring a National Collection Agency for our stores right from the beginning. I learned a valuable lesson and it was that Collection Agencies are not just for big business, so don't wait.