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Debt Collection Referral
Debt Collection Referral

When you need to escalate your customers to the next step of collection process.

Jane avatar
Written by Jane
Updated over 3 months ago

Debt Collection Referral Process: How It Works

If your customers have completed the full workflow in ezyCollect but are still not paying, or if you are new to ezyCollect with a list of overdue customers, you can escalate these accounts directly to debt collection agency through our integrated services.

We partner with trusted third-party debt collection agencies to provide a seamless extension of your accounts receivable process. Early referral is key—debts referred between 60-90 days past due are more likely to be collected.

Best Practices for Debt Collection Referral:

  1. Early Intervention: For the best chance of recovering your money, aim to refer accounts to debt collection between 60-90 days overdue.

  2. Prioritise Problematic Accounts: If a customer is consistently unresponsive, escalate them early to avoid further delays.

  3. Maintain Documentation: Ensure all communication records (invoices, follow-up attempts) are up-to-date to aid in the debt collection process.

  4. Regular Monitoring: After referral, continue to monitor the account’s status for updates and outcomes from the debt collection agency.

Debt collection Process

Once referred, the debt collection agency will implement a series of strategies to contact your customer and recover the outstanding balance. This may include demand letters, phone calls, payment negotiations, and basic location searches.

Debt collection services come with a commission fee starting at 25% of the amount collected from our recommended partners*. This covers all actions taken by the agency, including communication, negotiations, and monitoring of payments. 

If you are using a different agency, please discuss with your own agency directly the commission rate that they charge.

From 12th September 2024 onwards: All debt collection referrals will be sent with all the information via CSV (see details below). If you have done bulk referral, then the document will be grouped by customers with all the open invoices that has been referred. CSV files are sent every hour.

Sample CSV sent to debt collection agency

How to Manually Escalate a Customer to Debt Collection in ezyCollect

Follow these steps to escalate a customer to a third-party debt collector or send a demand letter:

  1. Login to your ezyCollect account.

  2. Navigate to the Customers section from the left-hand menu.

  3. Select the customer you wish to escalate by ticking the box next to their name.

    • If the customer is at the Demand Letter stage:

      • Click the Send Demand Letter button.

      • Confirm the action by clicking Send Demand Letter in the pop-up window.

      • Note: As of 12th September 2024, ARMA will no longer support the Demand Letter stage.

    • If the customer is at the Debt Collector stage:

      • Click the Send to Debt Collector button.

      • Confirm the action by clicking Send to Debt Collector in the pop-up window.

Alternatively, you can use the Communication Actions dropdown menu:

  • Select Send Demand Letter or Send to Debt Collector.

  • Confirm the action in the pop-up box.

Both the Demand Letter and Debt Collection stages are handled by a third-party debt collector integrated into your ezyCollect system.

Once you have taken these steps [for Debt Collection], all debtor communications history, open invoices and notes will automatically be sent to your nominated debt collector and the customer status will change to Exclude automatically. 

You can also refer customers to debt collection agency via Risk Portfolio - check out this article to learn more about Risk Portfolio.

Letter of Demand

The charge for the letter is AUD$49.00+GST* from our debt collection agency partner. The letter provides the debtor with seven days to make the payment and is issued by the third party debt collection with their own letterhead.

Demand letter referrals via ezyCollect are sent via email with the invoice attachment (one time password required to access these attachments).

Please note that from 12th September 2024 - ARMA will no longer support sending demand letter. You can still escalate to debt collection referral.

Debt Collection Agencies partnered with ezyCollect: ​

We’ve partnered with the following trusted agencies for seamless debt collection integration:

If you prefer to use a different debt collection agency or your own internal team, that’s no problem. Simply email us at customersuccess@ezycollect.com.au with the subject line "My Own Debt Collection Agency," and include the contact details of your chosen partner.

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