Bad debts recovery, worst situation by day In Dubai

Recovering of debts and management of bad debts are becoming high concerns in Middle East, the fluctuation of the economy in State has made the number of debt recovery cases as high as the skyscrapers in there but they also have strict laws and regulation to protect the organization from debtors that may hurt the balance of statement of the company.

Dubai being the city of high tertiary industrial has number of debt recovery agencies with highly experienced advocates that ensure the companies about the recovery of debts. Commercial debt recovery is yet another huge market yielded but its demand in Middle east and so Companies like Dubai Debt Recovery, Fort Equity and CEDAR Financial claim that they not only manage your debts but to recover them successfully and the same time securing the debtor creditor relationships.

The bad debt cases involve faulty debts due to identity theft, fraud, mismanagement of invoices etc. and methods of recovering them originally were mortgaging properties until cases went on to the debtors not having any. The scenario such were quickly identified and yet has been solved till date by the best agencies not just on national forum but globally.

The flexible deals of these agencies allow companies and organizations to recover content debts, the first party and third party prosecution helps the companies in making full conclusion in order to reach to the point that is in favor of the debtors.

Chris Maranis, the business development manager for Exus, told The National newspaper about debt-collection systems he has built earlier this year. He was asked about how the system would work in maintaining the high rate of bad debts in Dubai this was what he brought in to the spot light.

“In collections we have certain phases, so you have what we call early collections. This is the area where a customer falls into arrears – for example, he misses his installment day and banks start to communicate with the customer in a friendly and polite manner to remind him of his obligations. As you can imagine, as time goes by the banks escalate their communications to the customer from multiple channels. They can do either from a call Centre. They can do it by sending reminder letters. They can do it by outsourcing to collections agencies or by sending emails and any other means of communications. All this management of the delinquent portfolio of this call center, of this letter sending, of this outsourcing, can be done by a system. But collections systems can offer many more things that can benefit the bank and the debtor. This is very important. Many aspects of these systems or features they offer help the bank but also they help the debtors. However, we have seen that most of the banks have systems that were deployed more than six or seven years ago and they do not offer the new tools such as warning signals.

Upon asking how it will work he said

“One of the quite interesting aspects is the collections segmentation, as we call it. For example, think that you are a bank and you have 1,000 delinquent customers. Each one of them is a person. They might all be delinquent, but the treatment you are going to give to each one of them should be adjusted, if not to each specific customer, then to patterns of customers you can identify. So you have different customers. You have customers who have a temporary inability to pay because they have a very temporary problem. Or you have customers who are the people who are skipping their obligations in a very organized way. These are different kinds of people. I can give you an example that is very simple but it will help you understand. Imagine you have a loan and it is due on the first day of each month and imagine you get your pay cheque from your employer on the fifth of the month. That means that each month you are probably going to be delinquent for four days. If the bank does not identify this pattern in your payment methods, they might be calling you every month on the second of the month to remind you that you are late. This will irritate you. This will make you take your loans and go to a different bank. So you see, this risk segmentation can help the bank but it also helps the debtors.”

Each day the cases related to recovering of debts are reaching the lawyers and agencies while each day the suicidal situation of the other side makes it to the headlines. The mutual understatements are yet to be solved in the high functioning state economy.