What to prepare before discussing a collection assignment

A first conversation about a collection assignment goes better when both sides start with the same basic facts. It does not need a data file. It needs enough information to judge whether the work fits, where it will happen and what the agency will be allowed to do. Here is a practical checklist for lenders and businesses preparing for that discussion.

1. The type of accounts

Describe the portfolio in general terms: the product (for example two-wheeler loans, consumer durable loans, small business loans or trade receivables), whether accounts are recently overdue or long outstanding, and whether any are already under legal or recovery action. This shapes what kind of follow-up is appropriate. Customer names and account numbers are not needed at this stage.

2. Locations

List the districts, towns or mandals where the customers are. Be specific. “Andhra Pradesh” is a region; “Ongole and the surrounding mandals” is something an agency can plan around. Coverage should be agreed location by location rather than assumed.

3. An approximate volume

A range is enough: under a hundred accounts, a few hundred, a few thousand. Volume affects planning, the update format and whether the work should be phased.

4. What the agency is authorised to do

This is the most important item. Set out which activities are permitted — telephone follow-up, written reminders, field visits — and which are not. Be clear about who approves repayment arrangements, settlements and waivers. In most arrangements these decisions stay with the lender, and the agency refers customer requests back.

• Permitted contact methods and any timing restrictions you apply
• Identification and authorisation documents the agency’s staff must carry
• The payment channels customers should be directed to
• Escalation contacts for disputes, complaints and hardship cases

5. Your conduct and regulatory requirements

If you are a regulated entity, your own policies and the RBI instructions that apply to your category of lender set requirements for recovery agents. Share your policy or code of conduct at the start so it can be built into the assignment. RBI’s circular of 12 August 2022 on recovery agents is one example of these expectations. RBI has since issued further directions for different categories of regulated entities, so check the version that currently applies to you.

6. How updates should come back

Decide early what you need to see and how often: contact outcomes, repayment commitments, disputes raised and cases that need your decision. Agree who receives updates and in what format. If your team already uses a template, share it.

7. How data will be exchanged

Account-level data should move only through a secure channel both sides agree on — not ordinary email attachments and never a public web form. Agree who can access the data, how long it is kept and how it is returned or deleted when the assignment ends.

Before the first call

A short note covering these seven points is usually enough to begin. It lets both sides discuss scope honestly and avoids surprises once work starts. To begin a discussion with Sri Lakshmi Associates, use the enquiry form or call +91 87900 92296.