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International collection – are there any economic benefits to a technological platform?

The collection of outstanding receivables presents considerable challenges for many companies. Ultimately, they find themselves constantly caught between the economic necessity of having to achieve good recovery rates and at the same time treating debtors respectfully and lawfully. If companies operate internationally, the problems are multiplied due to the different laws and practices in each country. In this era of digitalization, there is of course also the question of whether all these various requirements can be addressed more efficiently using technological platforms.

Local expertise as the success factor

First and foremost, to deliver a successful debt collection service it is essential to consider country specific legislation and the cultural landscape. It is therefore crucial that the collection process takes place in the relevant country and with local points of contact! For companies operating internationally, this automatically requires a presence and collection expertise in many countries. The collaboration with an international collection partner with local representations can be a worthwhile solution.

Efficiently leveraging the value in collection

While giving the necessary attention to the appropriate treatment of debtors, companies should not lose sight of the fact that collection is a significant value driver. Around 20% of all payments in Western Europe are late. A large part of non-performing receivables would stay entirely unpaid without professional receivable management and appropriate collection measures. Due to the complexity of the international collection especially, it makes sense to look at the efficiency of the process. In the digital age, efficient IT processes and the secure exchange of data in both directions naturally play a particularly major role. Although digitalization has been a hot topic in the last few years, clients keep telling me that implementing the international collection process in their companies still has a long way to go.

Secure management and sensible use of data

Of course, the information required for the collection process is now largely available digitally. However, there is still ample scope for further improvement when it comes to the handling and use of data. Sensitive data is sometimes sent relatively insecurely by email. In other cases, specific interfaces are built in for each country, which must be operated individually therefore entailing considerable implementation and maintenance work. A central IT platform with automated processes and standardized interfaces, by which the data exchange is made much more secure and more efficient, provides some remedy.

A side effect of standardized data communication and use not to be underestimated is the creation of more uniform and therefore more comparable performance reports in all countries. This uniformity and transparency allows centrally controlled companies to sensibly use and analyze available data bringing additional benefits.

The key is in the combination

Personally, I am convinced that economic benefits in international collection especially can be realized if the local presence and competence are combined with the possibilities of digitalization. This is confirmed to me by clients who are already benefiting from CrossCollect, a combination of international Arvato collection services and the connection to our international collection platform.

You can find more information on how Arvato Financial Solutions can help you with the challenges of international collection here or contact us directly.

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