The seven financial institutions that failed the stress test were five in Spain, and one each in Germany and Greece. The four major UK financial institutions that were checked out, RBS, Lloyds, NSBC and Barclays were all successful and so this must put confidence in the UK economy such that if another economic downturn hits, then these major financial institutions will be able to keep going without government support. The results of this test must be available to anybody on the Internet and if the large organisation examines the results it is possible that they will be able to now pay the invoice from the small organisation. They could not contact the small organisation, but when they feel the need the small organisation will surely contact the large organisation to find out about their invoice. It could be at this point that the large organisation decides if they can pay the unpaid invoice at once or demand a further delay. If the result is a delay or some other reason for not paying then the small organisation could well feel as though they are being seen as a free credit resource.

The small organisation could not take too kindly to this approach and could then evaluate Debt Collection proceedings as their best next line of action, but their financial status could well be a limiting factor in how they run with the Debt Collection process. If they have good reserves than they could well simply decide on a normal Debt Collection solution of solicitors or Debt Collection Agencies, but they must be aware that the economic downturn has seen a rise in the numbers of Debt Collection Agencies and solicitors offering business Debt Collection services. The difficulty here is that the newer Debt Collection Agencies and solicitors could not be as ethical as the best of the normal ones and so the small organisation could well find themselves on the losing end either in cash terms or in seeing their commercial relationship with the large organisation getting damaged. The small organisation could not be able to distinguish between good and bad Debt Collection Agencies and solicitors so even if they accept the fees of 10% to 20% or more of the invoice value, hey could be better taking a different strategy for the Debt Collection process.

Debt Collection Software will allow the small organisation to take on the Debt Collection process with their own resources, which has the advantage that they are in control of communications with the large organisation and so must be able to secure their commercial relationship. Debt Collection Software can cost around

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Tags: Debt, debt advice, Debt Collection, Finance, Finances

This entry was posted on Saturday, August 21st, 2010 at 8:24 pm and is filed under Finance. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.