Understanding debt recovery in the UK
The UK’s debt collection process begins when a client recognizes a non-payment and begins the pre-legal cycle. This is initiated with series of dunning letters, emails and telephone calls made to the buyer. Within the UK Collection team, we aim for a window that lasts a maximum of 30 days, which is shorter than in Italy, for instance, where it can last up to 60 days.
In collections, speed is vital; the faster you send a payment reminder, the faster you receive payment. Escalation and following up on late payments are key to making clear to the debtor that the collector means business. Once the window has passed for amicable repayment, the case is brought to court.
It is common in the UK for debt disputes to be settled without legal action. However, where it is necessary to proceed with court action, Allianz Trade is prepared to step in. The UK Policy Holder has 90 days past the due date to attempt to resolve the dispute themselves. However, it can be placed with us earlier. In this case, the UK Collections team take over all communications with the debtor and recommend that our client stops interacting with them. By acting like a buffer, we hope to prevent friction and preserve a positive relationship between the customer and the buyer for the future.
Top tips for UK firms
Consider the retention of title clause
Develop strong credit control processes
Conduct due diligence
Allianz Trade, an ally to UK businesses
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