Equally as important, is to hire an agency with a proven track record of successful collections in the industry. In addition, look for an agency that has the following:

• Compliance and data security certifications
• Nationwide collection licenses and is fully bonded
• Client references including other credit unions and business associates
• BBB Accreditation
• Proper insurance
• Established tenure of leadership team and collectors
• Proof of customer and member satisfaction
• 24/7 secure web portal with easy to view account information and reporting
• Competitive fee that will result in larger returns

Now that you know what to look for in an agency, how you manage these relationships will directly impact how successful your relationships will be. We’ve outlined four (4) best practices each credit union should considering when managing their vendors:

1. Establish Expectations and Open Communication

New vendor relationships should begin with a detailed onboarding process to ensure that the requirements and expectations for a successful business relationship are clearly defined, communicated, and documented. Throughout the process, you should strive to develop open and transparent lines of communication between the vendor and your team. Clarify roles and responsibilities. Outline policies, procedures, and cost expectations. Define upfront problem resolution and escalation processes. You should require for this same level of cooperation and transparency throughout the entire vendor lifecycle.

2. Establish Set Pricing

Establishing a preset fee structure across your vendors will allow you to focus your assessments on key performance-related criteria rather than price. The percentage rate of commission should be less important than the agency’s percentage of return on the total dollars referred for collection. This will also allow you to evaluate your agencies on an equal playing field.

3. Consistent Reporting

Requiring monthly dashboards will allow you to proactively monitor established goals and annual report cards (KPIs) will provide you with the reporting to recap on the year’s successes and identify improvements needed. It’s important to take the time to check in and confirm expectations are being met, across all levels of the relationship.

4. Streamline Your Agencies

Many creditors are relying on proven relationships with fewer (but higher performing) partners to deliver better results. By consolidating your business with one or two of your top performing collection agencies, you are guaranteed to increase the percentage you recover for every dollar you spend. Another way to streamline the process is to place your accounts within 6-12 months to optimize collection results. It only makes sense to move accounts to your top performing partners to begin yielding a higher return more quickly. To see how much you could save, we’ve provided this simple calculator to see how much you can increase recoveries for every dollar you spend: conserve-arm.com/calculator

Applying these four best practices when managing your collection agency vendors will lead to a successful relationship that will ultimately increase your recoveries on past due accounts sooner. A collection agency is an effective method of debt recovery and when you use an ACA Blueprint® certified agency, it’s done in a compliant and empathetic way.

Looking to read more about what to look for in a collection agency, especially when it comes to ensuring data security? Check out our E-Book Comparing Collection Agencies: How to be Sure Data Security is a Priority