Challenging Times for Scottish Debt Recovery

The past few years have been challenging for debt recovery.  There is no doubt that achieving settlement when an account is delinquent is more difficult.  The key requirement for all organisations is to have an effective credit control policy in place and to stick to it.  Typically this should ensure that accounts are rendered quickly, accurately and addressed to the correct person.  Thereafter the creditor should ensure follow up measures are taken.  The idea here is to expedite payment by writing to the debtor, phoning and possibly a visit to their premises.  These measures may well lead to settlement.

Once the creditor’s own procedures have been exhausted then the account should be passed to a third party for collection. Typically a specialist Debt Recovery Lawyer will be able to accelerate the recovery process to meet a particular creditor’s requirements.  Some debt recovery specialist lawyers have online case management systems allowing clients to look at their cases and instruct them “24/7”.  What will a lawyer do?  This will all depend upon the client’s instructions.  Typically, as a starter, the lawyer will send a letter to the debtor demanding payment.  And remember if the debtor is a business interest at 8% above the Bank of England base rate as well as collection costs can be added to the debt.  This often produces a positive result.  If further action is needed then the lawyer may well suggest taking the debtor to court followed by Sheriff Officer enforcement.  Insolvency proceedings may also be used as an alternative.

However it is important for creditors to act quickly.  And remember you cannot get blood out of stone.  If the debtor has no assets it is unlikely creditors will be successful.  But if the debtor is a slow payer a letter before legal action followed by litigation should do the trick.