Debt collection: a thorough understanding

Debt collection involves requesting the debtor to make payment of due / overdue amounts and other assets to the creditor under a contract or agreement between the two parties or according to the decision of the State authorities.
Note: Only when a debt is due / overdue can the creditor be entitled to claim it. This is a problem that for individual debts, people often do not pay attention and effort to litigate, which sometimes takes too much time and unjustly costs. Businesses often avoid this because the nature of the debt is usually clearer, more specific and the person in charge of the debt is more qualified.

For individuals, recovering a debt is important but often not urgent. However, for organizations / businesses, the efficiency of debt collection is vital. It is very rare for any enterprise to do business without having to take a loan; and there is certainly no business that does not let other individuals, organizations / businesses owe their money / assets. Therefore, it can be said that when doing business, a company can be a creditor and a debtor at the same time.
 
Businesses may have the ideal operating status when they do not have overdue debts and are not appropriated by any enterprise over the prescribed time limit. However, it is difficult to find out which enterprises can achieve this status among hundreds of thousands of businesses in Vietnam. In fact, all businesses want to misappropriate capital of other enterprises for as long as possible, especially when the economic situation is difficult as in recent years. And most businesses go bankrupt because they cannot pay their debts.
There are 3 important implications of debt collection:

These are extremely important papers that determine the success of a debt recovery. In fact, more often than not many of the debts seem to be very clear, but the creditors could not prove that they had fulfilled their obligations to the debtors before the debt collection rights arise. 
The most common case is that there is no contractual agreement relating to the cooperation and sale between the two parties. Representatives of debtors and creditors are acquaintances so they tend to be subjective. There would be no contracts, or contracts do not strictly comply with legal standards: the signer and seal.
Next is the absence of acceptance records, or acceptance records of delivery and installation without the signature and confirmation of the debtor. Sometimes, businesses unintentionally combine the minutes of certification of handing over installation materials and the minutes of acceptance and completion of the works into one. In general, when either of these two tasks is not completed correctly, debtors can make excuses to delay payment of the entire order value.
In case of having enough papers and records as above, debt collection is not guaranteed to be 100% successful, because it depends on the financial situation of the debtor and the cooperation between the two parties, as well as other arising issues. However, if one of these documents is missing, debt collection work will be much more difficult. Debt collection officers need to find ways to supplement and legalize documents and procedures, which will take more time and cost.

Most of the time, it is advisable to appoint the Manager to be in charge of debt collection because this is a person with knowledge, vision, and is able to decide everything right away, without having to waste time reporting and asking opinion. Especially, this person will show the prestige to the person in charge of debt repayment of the debtor, making debt collection easier. 
It is also suggested that the Debt Collection officer or any other accountant or department should be in charge, depending on the complexity and value of each debt. Doing so will solve the problem of overloading for the Manager.
However, in my opinion, choosing the person who directly interacted with debtors previously is highly recommended because:

 Note: these methods should only be applied during the negotiation phase. If negotiations are unsuccessful, we will enter the legal phase when professional support from debt collection service provider will be needed.

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