The Rewards and Pitfalls of International Collections

For a collections company looking to expand their business and horizons, international debt collections is a viable option to put your company on the track to more money and more clients.  In an increasingly global marketplace, companies are doing business with third-party contractors from other countries who might offer great prices at the beginning of a business enterprise but end up failing to pay. 

As this situation becomes more common, these companies and small businesses will be looking for collections agencies and collection attorneys who specialize in this unique form of collections.  Since few collections agencies offer international collections, your company would have a lucrative advantage in a specialized area that is too often under-represented in the United States. 

While the advantages and rewards are immediately apparent, there are several pitfalls along the path of international collections that should be considered before you branch out into this arena.  Below are some issues to further research before making the decision to accept international collections tasks from your clients. 

1. Different legal requirements—branching out into international collections means facing an entirely new set of legal requirements for collections practices, depending on the country where the debtor resides and operates.  These legal requirements can create hoops that are tricky to jump through and must be thoroughly researched before taking on a case. 
2. Foreign language ability—language obstacles present a significant hurdle to debt collections, and might require the use of translators to effectively communicate with the debtor and with the necessary legal agencies in the debtor’s country of residence and business operations.  This presents an added cost to your base operating expenses that is not always necessary in collections within the United States. 
3. Time zone differences—since you will be on a vastly different time zone than the debtor, this obstacle might present challenges for communicating with him or her.  In addition, as there are US laws regarding the times in which a collector can communicate with a debtor during the nighttime hours, these laws are also present in other countries, increasing the challenge.