Debt collection rates are rising. The pandemic led to a spike in debt levels for businesses throughout the world and now creditors are coming to collect. Companies are using new and more efficient ways to reach out to customers and clients who may still need to make a payment, using everything from traditional debt collection efforts to artificial intelligence (AI).
AI is gaining global traction as a way to help better ensure companies contact their clients with less hassle and ultimately push harder for that payment. Companies can use specially designed algorithms to better tailor collection strategies for their markets.
So what’s a client or customer to do when they have unmanageable debt? Businesses that are struggling to make ends meet may not be able to pay off suppliers or other creditors. What options are available in these situations?
The first step, and likely one most business owner have already taken before taking the time to read this post, is to review the business’ budget and adjust where possible. Having a current budget and knowing where the status of assets and debts is an important step towards addressing the issue. In some instances business owners can negotiate with creditors to either refinance with a lower interest rate or find a hardship program. Banks and other creditors may offer these programs, which provide additional assistance to meet debt obligations in certain situations.
It may be wise to seek additional help if these efforts are not successful. Options like liquidating assets or bankruptcy can offer a fresh financial start and free business owners up to pursue other opportunities.