Frequently Asked Questions

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The following Frequently Asked Questions and answers are provided to help you to gain a better understanding of the debt collection industry and how using a debt collection company will enhance your accounts receivable processes. Although we have tried to address the most frequently asked questions, it is impossible to anticipate all your questions on this page. Below you will find the answers to ten of the most frequently asked questions.

At AMPAC, we have observed our most successful clients combine robust internal credit management procedures, quality credit documentation and swift escalation of past due debts to prevent their debtors from delaying the recovery process, stalling payment or paying other creditors ahead of them.

If your business does not have the resources or expertise to consistently apply this approach to debt collection, then you should consider using a debt collection agency to enhance your prospects of recovery. Put simply, your debt should be referred to a collection agency as soon as you feel the debtor is not responding positively to your internal collection efforts.

Following are three very common scenarios that indicate the debtor is ignoring recovery efforts and/or is not taking your demands for payment seriously.

  1. The debtor has failed to honour, two or more promises to pay.
  2. Three or more contacts with the debtor have failed to secure payment. This contact may be a combination of phone calls, reminder letters, emails or text messages.
  3. The debt is more than 60 days overdue for payment, and the debtor continues to ignore your requests to pay.

Referring the debt to a debt collection agency in any of the above scenarios will allow you to focus your resources on the recovery of debt which is less than 60 days overdue, thereby maximising cash flow and minimising costs. Our experience has proven that the older a debts is, the harder it is to collect.

There is no minimum or maximum debt amount required before you can refer a debt to a collection agency. However, the amount of the debt will help determine the best and most cost effective action required to facilitate recovery. A well-resourced and professional debt collection agency will be able to discuss the various options, and make recommendations based on the debt amount, the circumstances of the debtor and the costs involved.

No collection agency can guarantee that the debt you refer will be recovered. However, an experienced, professional debt collection agency will be able to quickly assess the recoverability of your debt and suggest recovery options to improve the probability of recovery in the most cost effective way possible.

There are a number of factors that determine how long it takes to collect a debt. These include:

  • Cash flow and overall financial position of the debtor
  • The debtors’ willingness to pay
  • Is the debt in dispute, and the complexity of the dispute
  • The quality of your credit documentation
  • The existence of Personal Guarantees

Referring the debt to a debt collection agency will reduce recovery timeframes, enhance recovery prospects and reduce the potential of a bad debt arising.

Yes, in most States and Territories of Australia you are able to recover all your collection costs from your customer. However, this is only possible if your Terms & Conditions include a ‘Cost Recovery Clause’.

Legislation in some States, such as Queensland, does not allow you to recover all your collection costs from your customer, even if there is a Cost Recovery Clause contained in your Terms & Conditions.

Your collection agency will be able to advise you in advance as to whether or not costs are recoverable.

This is not the case. A collection agency should keep you right up to date with the progress of each of your matters. Most established collection agencies will also provide you with 24/7 real time access to their debt collection system which will enable you to track the progress of your debt online anywhere in the world from your workstation, tablet or mobile phone.

The cost will vary depending upon the size and nature of the debt, the age of the debt and if a dispute exists. A reputable debt collection agency will explain the costs that may be incurred before you refer the debt, so you are able to make an informed decision.

Usually, a debt collection agency will charge a commission for their services, however this is only payable upon the successful recovery of the debt or part there of.

If legal action is required, then there will be additional costs involved. Here again, your collection agency will be able to explain the process, costs and timeframes involved so that you are fully informed before you decide to proceed. Legal action should never be commenced without your prior approval.

Most well established debt collection agencies will be able to handle work all around Australia and in New Zealand.

At AMPAC, we can assist you to recover debts in Australia, New Zealand and almost anywhere in the world where you do business.

In certain circumstances, a debt collection agency may recommend you write off a debt.

In the case of a company debt (Pty Ltd), if the company becomes insolvent, and you do not have a personal guarantee, the most likely outcome is that the debt will be written off.

If your customer is a sole trader and he or she becomes bankrupt, then the most likely outcome is that the debt will be written off.

Unfortunately, sometimes debtors simply disappear and cannot be found, and on other occasions, the size of the debt does not warrant extensive recovery action.

At AMPAC, we have many years experience locating debtors, identifying their assets, and recommending the most appropriate recovery action.

Yes, the team at AMPAC have been assisting businesses throughout Australia and overseas for many years. AMPAC’s customers include large and small businesses as well as Government organisations.

Talk to us about your particular circumstances and we will explain all your recovery options as well as the timeframes and costs associated with recovery of your debt. A big part of our job involves supporting and educating our clients in the area of receivables management, and we are here to help you too.

AMPAC has invested in the very latest, purpose built debt collection technology. Technology that is designed to give you a clear advantage when collecting your overdue debts.

If you would like to know more about AMPAC’s services or simply need some advice on a particular debt, please give us a call on 1300 426 722 or email us at

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The team at AMPAC Debt Recovery have developed debt collection strategies designed to suit the broad range of markets they specialise in.

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