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Optimization Use of Multiple Collection Agencies

I have heard from a few creditors that when it comes to allocating accounts to collection agencies for recoveries creating a rule based strategy isn’t always in the cards.

When clients use multiple collection agencies their ability to allocate accounts to the different agencies based on rule based strategies isn’t always available. Some have a single setting on a billing or assignment system that indicates the account is to be assigned to Collection Agency X versus Collection Agency Y, and there is no easy method to make that assignment based on a true strategy. Worse yet, it is often difficult to impossible to reassign that account from Collection Agency X to Collection Agency Y if the account status or risk level changes.

This means that their use of multiple collection agencies is not as “optimized” as it could be if a scripting or rule based tool was available to the business user. Optimizing assignments means that the account is initially as well as subsequently assigned to the right agency at the right time based on its type, risk, history, balance, status and other circumstances to maximum recoveries. This approach can make a significant difference in the recovery of bad debt.

Furthermore, test results or allocations should be displayed after a script has been entered. This usually provides a “what if” on collection agency assignments displaying the number or dollar value assigned if the rule was implemented. That way you know if the script is correct (ballpark allocation seems reasonable), and if the allocation to any particular agency is within policy limits by dollar amount or number of accounts.

  • Do you believe that you are optimizating your allocations to the agencies you use?
  • Do you have the tools you need to effectively assign each account to the right agency?

Experian can help with its agency allocation and management solutions through Tallyman Agency Allocation. Learn more about our Tallyman Agency Allocation software.