PETALING JAYA: Debt collecting is a much misunderstood profession. The picture of thugs breaking down a borrower’s door and threatening harm to recover unpaid dues is more fiction than fact.
Debt collecting can be a high-risk job. Take it from Ramesh and Julian (not their real names).
A good tongue-lashing is a mild form of retaliation from stubborn borrowers. Ramesh has even been set upon by canines that looked like they were out for blood.
But for the duo, it is all in a day’s work.
“One needs to be very patient to become a debt collector,” Julian told theSun recently as he recounted his day at work.
As an independent debt collector, he does not have the support of a collection agency.
“We just have to rely on our wits and be street smart,” he said.
“We meet all sorts of people. There are those who are willing to pay up, but some just refuse to make good on their promises,” he said.
To protect themselves from unscrupulous clients who may be out to use them just to extort, debt collectors demand various documents such as an IOU, as proof of lending, as well as all the information they can get about the borrower.
“We will not take an assignment without proper documentation. Otherwise, the borrower can lodge a police report against us, claiming we are harassing him,” Julian said.
The modus operandi is hardly what one would imagine.
“We do not simply barge in and demand settlement,” he said.
Some groundwork has to be done, and that involves talking to people who live or work in the borrower’s neighbourhood to get some background information about him.
“Only after we have some information about him do we approach the borrower,” he said.
Even then, the debt collector will still not be able to guess how the borrower will react to his presence at his home or place of work.
“Our cardinal rule is to not fight fire with fire,” he stressed. “That will not solve any problem.”
On many occasions, borrowers just deny owing any money, and chase him out of their premises, he said.
Swearing and a litany of expletives are a common reaction of borrowers.
According to Ramesh, debt collectors have a heart too.
“If a borrower genuinely has trouble paying up, we will agree on a monthly repayment scheme,” he said.
“Of course, that also depends on the situation.
If a person can afford an expensive car and still refuses to repay a RM10,000 loan, I will ask him to repay in full or in two payments.”
For their services, debt collectors get a cut of the sum that has been recovered.
According to Julian, sums owed range from RM5,000 to RM200,000.
“Our cut depends on many factors, depending on how difficult it was to collect payments and whether the borrower is a titled person.”
When out in the field, debt collectors must be prepared for any eventuality and learn how to deal with each of them.
“Many people will come up with sob stories to avoid paying up but I have on at least one occasion, found out that a borrower truly did not have a single sen to his name,” Ramesh said.
