How to start a debt collection agency

A debt agency is a connection between your client and the debtor. One has to be calm and patient while dealing with such matters. Debt agencies have to come with ideas and plans that provide ease to debtor and as well as satisfaction to the collector.

To start up an agency of debt collection or debt consolidation following business plan should be kept in mind: 

  • Calculate business cost of debt agency you want to start up. You can even start up a debtor agency at home because the upfront cost is quite low. All you need is a laptop, phone and business card. But if you are planning on expanding your business keep in mind the cost of rent of your office. Choose a location that is easy to access and should have a desk space. Other than that transport expense should be kept in mind in case of meeting with debtor. Office equipment, marketing of your business, license and insurance of business are also some expenses that you should add in your budget.
  • Register your business as legal. It is important for the security and privacy of your business.
  • If you submit your business as a legal entity after the legalizing procedure then you are liable to pay taxes for your business. Federal and state taxes are mandatory over the period of time.
  • Every business entity should have a separate bank and credit account. Because if you mix your personal and business account then you are at a risk in case of a legal action against your business. Business bank account and business credit cards helps in keeping the check of your expenses.
  • Record each and every cost and profit that your business is having to know the monthly and yearly performance of your business. 
  • For the proof of legalisation of your business get license and permits. In case of lack of permit, your business might get fines as well as is at the risk of shutting down.
  • Business owners should get insurance as a precaution and if you have are hiring other workers too then they might also require insurance in their package.
  •  Your agency should be a well reputed brand only then it will grow. For that you need to come up with a creative marketing strategy both digitally and at networking events.
  • A business should always have a website. Clients could go through the service your agency is providing and can easily refer to others too.