How businesses can deal with debt collection during Covid-19May 18th 2020
Natalie Tatton Solicitor in our Dispute Resolution team provides some top tips for debt collection during Covid-19.
With businesses across the country facing financial uncertainty, it is important that your own business is protected as far as possible. Although there is some government support to businesses, there are going to be financial problems as a result of Covid-19 and many businesses have already seen their income reduce significantly. Many individuals may be unable to repay their debts for quite some time. As a result of this, cases of debt recovery are most likely to increase.
Cartmell Shepherd’s debt recovery team remain fully operational throughout this uncertain period. We are here to offer you our support and guidance through the debt recovery process. Whether this to be recovering a debt from an individual or a company we are able to assist.
It is vital that companies take the necessary steps to shield their cash flow now. Please see the below for some of our top tips:
Top tips for debt collection during the coronavirus crisis
- Ask your debtor to send you their repayment proposals. It is best that their proposals are in a written format as this is evidence that the debtor admits to owing the debt.
- Do not be afraid to investigate whether the reason for the non-payments and/or postponement of payment is caused by Covid-19. If the debtor claims that they are unable to make payment to you due to Covid-19 then ask them to provide written evidence to verify this. If the debtor does not provide written evidence, or if the evidence indicates that the situation is not as bad as the debtor claims it to be, then payment must be made. You can then also consider the options available to you to recover the debt.
- Demand additional securities. If the debtor is unable to meet the payment agreed, it is worth investigating whether your debtor is able to provide securities to you.
- Where it is possible to do so, obtain money up front from your client for your services. This will help to maximise your cash flow.
- It is paramount to be in contact with debtors as soon as possible and keep a record of all correspondence you have had with the debtor.
If you would like any further information on the above please do not hesitate to contact our Debt Recovery Team on 01228 516666 who will be happy to assist.