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Recovering Money Owed to You – A Guide to Debt Collection

It is no secret that some people will go to any length to avoid paying what they owe. Both businesses and private individuals provide goods and services every day, and it is only right that they are paid for doing so.

When money is owed to you, you will need to decide on a course of action to recover the funds. If the debt is left idle for too long, it can be more difficult to begin the recovery process. As well as this, repeated cases of non-payment can severely affect your cash flow.

For a business, this can cause issues, as a healthy cash flow is needed to maintain and grow the company. For private individuals, or those that are self-employed, being owed money can represent a financial blow, making their commitments more difficult to pay.

Small businesses in the UK are owed over £21,000 on average from overdue invoices and non-paying clients. This shocking statistic shows how much of a problem debt can be for businesses of any size.

For a great number of people, recovering the debt is often perceived as too great of a cost, and so many choose to write it off before attempting collection. Others seek to sell the debt to a specialist agency, although it is wise to explore the possibility of collection before doing this as debts are usually purchased for a very low amount.

When someone owes you money, it can be a challenge to know how to proceed. There are many methods of recovering a debt, and knowing the specifics of each one requires a lot of knowledge and insight before committing time and money.

How Can I Collect a Debt? What Are the Options?

There are surprisingly a lot of options available to those that are owed money. Many people already have a clear perception of what their options are, but it is important to consider each one before committing to a course of action.

Contacting the Debtor

It may sound simple, but in many cases, it is often better to contact the debtor before taking any other course of action.

It is common for someone that owes money to have a perfectly simple explanation for why they have not paid. For example, they may have simply forgotten to pay, or they could be in financial trouble and do not have the funds.

By contacting the debtor, you may be able to resolve the issue without needing to go to the expense of another option.

You should be aware, however, that some debtors will provide excuse after excuse, and it is common for people to be fooled by a debtor that can pay but won’t for years. Setting a cut off point or a deadline is a good idea, as you will save yourself a lot of wasted time and money.


Before taking more severe measures, it is always worth attempting to resolve matters through mediation and arbitration. Whilst it may be preferable to taking more serious steps in some cases, this may incur a cost. It might also mean that you are unable to recover the full amount of what you are owed.

Legal Action

Historically, it has been common for people to carry out legal action when they need to recover money from someone that has chosen not to pay them.

Taking the issue to a small claims court can be effective, but will also incur a great expense to those who have chosen to do this. It is no secret that solicitors and law firms charge a great amount for their services, and recovering a debt is no different.

This cost must be factored into your decision-making process, as legal expenses can quickly mount up. It is also worth considering the costs that will be incurred if your case is not won. Taking legal action carries a risk, as there is always the possibility that your case against the debtor will not necessarily go your way.

If the case is successful, the person may have a CCJ made against them. Whilst this is a positive outcome, you will most likely still need to enforce the collection of your debt at a further cost.

Court and legal action can be an effective method of recovering a debt, however, the cost can prevent it from being an option to many. These people are forced to write the debt off, leaving themselves in a precarious financial position.

Debt Collection Agency

The use of professional debt collection agencies is becoming an increasingly common occurrence for both businesses and private individuals. A debt collection agency will be able to recover money that is owed swiftly and effectively.

Agencies typically provide their services at a drastically lower cost than that of court action. Whilst this cost is lower, it should still be considered when making a decision.

Many debt collection agencies are specialists in specific types of debt or industry sectors. Federal Management, for example, is the UK’s leading commercial debt collection agency. They have helped thousands of companies recover millions of pounds worth of unpaid fees since their opening in 2004.

Frontline Collections, on the other hand, are a UK debt collection agency that specialises in private debts. Their collection experts help smaller businesses, people that are self-employed and private individuals recover money that is owed to them.

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About the author

Jimmy Rustling

Born at an early age, Jimmy Rustling has found solace and comfort knowing that his humble actions have made this multiverse a better place for every man, woman and child ever known to exist. Dr. Jimmy Rustling has won many awards for excellence in writing including fourteen Peabody awards and a handful of Pulitzer Prizes. When Jimmies are not being Rustled the kind Dr. enjoys being an amazing husband to his beautiful, soulmate; Anastasia, a Russian mail order bride of almost 2 months. Dr. Rustling also spends 12-15 hours each day teaching their adopted 8-year-old Syrian refugee daughter how to read and write.