There has been a lot of talk throughout the Bahamas recently regarding the implementation
of VAT and the collection of taxes. While for the most part the talk and views expressed are
from respected individuals who are experts in their respective fields, none of the persons can
claim to be experts in the field of “debt collection” in general or “debt collection in the
Bahamas” in particular.
Apex Management Services has been in business for over 15 years and is the only debt
collection agency in the Bahamas that is capable of handling the full spectrum of debt
collection with state of the art technology and resources that are all under one roof.
While there are several debt collection options that include; In-house Collectors, Internal or
External Attorneys, Internal Call Centers, External Call Centers and Offshore Call Centers,
none of the options are as efficient and effective as a Local Full-Fledged Debt Collection
Agency, which can handle matters from start to finish without gaps.
Some of the inherent flaws that are associated with the various collection options that often
substitute for Debt Collection Agencies are as follows:
Internal Attorneys at best would function similar to an external attorney with the difference
being that they would be more accessible. At worst an Internal Attorney would also have a
focus on other duties, which would diminish the attorneys role as a specialist with 100% focus
on debt collection. Although Day Court is an option, as a matter of convenience, many civil
matters, which fall in the Magistrate courts jurisdiction, are heard in evening court, which
would often necessitate odd hour for an internal attorney.
External Attorneys do not operate debt collection agencies; in many instances their main
focus is to obtain judgment with little if any interaction with the debtor. Prior to obtaining
judgment and after judgment is obtained; attorneys do not have the capacity to provide the
care and attention to each and every individual account. In most cases attorneys will bill the
client after judgment is obtained and the client is still left to collect the amount of the claim.
Many matters handed to attorneys go uncollected long after the attorneys have been paid.
Onshore Call Centers are on the opposite end of the spectrum from Attorneys, in the debt
collection process. While Onshore Call centers are extremely good at interacting with
debtors, they have no enforcement capabilities. If a call center operator is dealing with a
debtor who is not cooperating or refuses to pay, the call center has no recourse but to send
the debt back to the client who will most likely send it to an attorney thus creating a time and
process gap, when time is of the essence.
Furthermore Call Centers have no capabilities to locate debtors whose whereabouts are
unknown (Skip Trace) even though a large percentage of bad debt matters require Skip
Tracing. At best, Call Centers are only suitable for early stage debt not late stage debt.
Offshore Call Centers have the same disadvantages as Onshore Call Centers plus the
following added disadvantages.
Communication and Culture - In most cases Offshore Call Centers operate in countries
where there are cultural differences that are often subtle but significant. This is compounded
when English is not the native language or where patois is predominant.
Geography – Psychologically if a debtor senses that there is some significant distance
between the call center operator and themselves they are less likely to cooperate or pay.
Speaking from experience gained working with a major commercial bank that implemented
an offshore call center option that failed miserably, Offshore call centers or Offshore
Collection Agencies do not work.
The differences that a properly equipped and professional Debt Collection Agency such as
Apex makes to the collection process that none of the above options can provide are as
follows:
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Principal has over 30 years of Credit and Collection Experience.
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Principal is an accomplished Fellow and Member of the largest International Debt
Collection Trade Association. ACA International, the Association of Credit and
Collection Professionals.
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Agency has been in operation for over 15 years
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Easily accessible well-maintained and spacious offices conducive for customer
service.
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Adequate telecommunication technology and operators to handle thousands of calls
daily.
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Auto-dialers, which exponentially increase the calling and communication capacity of
the call center.
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SMS technology which exponentially increases the communication capacity of the call
center
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State of the art Collection Management Software capable of handling unlimited
number of accounts with integrated financial accounting, diary management and many
additional features.
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State of the art Legal Case Management Software
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24/7 client web access
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Skip Tracing Database and Skip Trace Network
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In House Attorneys that are 100% dedicated to debt-collection-litigation.
“International financial institutions, such as the World Bank and International Monetary Fund
(IMF), have propagated a conventional wisdom that revenue collection authorities are more
effective when they operate autonomously from the state, as a commercialized entity at arms
length from government rather than as a department within the government administration”.
(Source: Preconditions for Effective Tax Collection, By – Economic Policy Research Unit, Bergen Norway)
A growing number of U.S. states are expanding their relationships with private collection
agencies to settle long-overdue taxes.
Her Majesty Revenue & Collection (HMRC) has outsourced some of its debt collection to
external agents. Following a pilot, a notice entitled ‘Modernizing debt collection’ was released
explaining that four debt collection agencies will be employed by HMRC to collect an
outstanding £140 million of outstanding tax debt. (Source: HMRC sends in debt collectors for unpaid
taxes. By-Nick Lodge, Director of debt management and banking HMRC.)
In Spain alone more than 800 companies specialize in collection of outstanding debt,
handling a total of 71 billion euro and generating close to 560 million euro for their business.
(Source: DBK, “Empresas de Gestion de Impagados)
With an obvious eye on an opportunity to capitalize on the existing situation, a number of
over night debt collection vendors are beginning to surface without any experience or
capacity to perform at a level that would be required.
It would be a shame if we as a country succumb to the temptation to award debt collection
contracts based on patronage rather than on merit, at such a time when our country’s
financial well being is at stake.
Disclaimer:
The views expressed here are solely those of the author in his/her
private capacity and do not in any way represent the views of
TheBahamasWeekly.com