22nd November 2017.
CPA (PAID) Hits The Collection Jackpot Again!
The Credit Protection Association’s debt purchase division has demonstrated once more their collection prowess
Very often the mere transfer of debt ownership to a third party can aid recovery – especially in tough collection situations.
A case in point occurred recently in the CPA (PAID) Office, who hold responsibility for debt purchase.
Our Member was owed £14,327 by an apparently well – established engineering company. Some 25 per cent of the debt was nine months overdue but our member had continued supplying throughout last spring and early summer on the basis that “ They always pay us in the end, don’t they”.
In August the Member lost patience and offered the debt to CPA (PAID) for purchase. By that time the age of the debt meant it could only qualify for “non-recourse” purchase, where PAID assumes the bad debt risk. Only the most recent invoices amounting to £2400 were acceptable.
However, in order to assist the Member, PAID purchased the balance with recourse whereby the bad debt risk remained with the Member, and PAID were responsible for all legal and collection costs.
The Member need not have worried about the risk! Soon we had cooperated with retained solicitors, and collected the lot! In addition to the principal sum , we were awarded £500 for legal costs and £1422 for interest and compensation payable under the terms of the Late Payment Act.
The debtor must wish that they had paid on time. Not surprisingly, our Member is delighted, if a little sheepish.
A valuable lesson has been be learned Do not delay action when it becomes clear that the customer’s cash flow is under pressure.
Refer the debt to experts and avoid risk and worry.
David Hawkins, 22nd November 2017
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