What is the difference between debt collection and purchase of receivables: e.g. Bank receivable?
If the agency collects assigned receivable:
- The agency is an intermediary in the communication with the debtor
- The agency requires payment solely at the office/bank account of the Bank
- The Bank can initiate legal actions in order to collect the debt
If the agency has purchased the receivable:
- The agency is already a creditor for the debt. The debtor must be notified for the sale of the debt
- The agency collects the recovery at its own bank account
- The agency can offer more flexible conditions for the debt payment
- Through the sale of receivables, the creditor clears the non-performing receivables from its balance sheet and releases internal resources