The pros and cons of effective debt collection methods, whether in house or outsourcing to a debt collection agency. Once a debt becomes aged, it can be much more difficult to collect. There are different methods available to do it, but do you know which will be the most effective for you?

Here are some options for chasing debts that are overdue, and the pros and cons of each.


If your company has a credit control team, you may wish to chase the debt yourself.


  • Your team already know and have relationships with your clients. The process will be handled within the business from start to finish. A more personable approach.
  • You can update your cash flow as it changes, as everything is completed in your knowledge and control at all times.


  • Chasing over-due payments is time-consuming. If your company is small, dedicating one employee to collect debt can leave you short for time and resources.
  • Furthermore, limiting someone to just managing credit control will mean they have far less time for other jobs and responsibilities.
  • You may have to consider other overheads as it is not always cost effective to pay a salary for someone to do just this as it is so time-consuming and may only reap small benefits.


You may choose to reserve your company’s time and resources, and instead outsource the work.


  • Companies that specialise in debt collection have years of experience and often guarantee a full recovery of your debt.
  • Most debt collection agents, like ourselves at FJCM, are ‘no win no fee’ – so we only get paid if your debt is recovered.
  • They take the process off your hands so you can focus on running your business.
  • Often the mention of debt collectors to a debtor will be enough for a customer to pay before any proceedings take place.
  • The debt collection agency will resolve, negotiate and mediate any dispute so you can maintain a good relationship with your clients.
  • The older the debt, the more difficult it is to collect because of debtors details or circumstances changing. Having expert support will help to improve your chances of recovery.


  • You may find it daunting trusting an outside person to act on your behalf. It is important to find a debt collector that will respect and protect your brand and customer relationships as if they were their own.


Customers who refuse to pay you may need a firmer approach taking via the legal route.


  • Often the warning of legal action – i.e. a ‘Notice Before Proceedings’ letter is enough to make a customer pay.
  • It is an effective last resort option for a customer who fails to pay you.
  • A good company will provide practical support and experienced specialists to help you.
  • If your claim is successful, the court fees will be refunded to you.


  • Legal proceedings are often expensive and time consuming.
  • There is no guarantee you will get back what you are owed as legal proceedings are sometimes unsuccessful and you will still have to pay the legal fees.
  • Customer relationship will most likely be damaged.

It is  important to evaluate the cost and risk of each debt so you can decide which process to use to leave you with the most effective outcome.

After all, you don’t want to lose more money than you collect – whether that be in fees or by sacrificing valuable time and resources to chase the debt yourself.

Recover a debt - no win no fee