90 % of the French B to B debtors with unpaid bills are solvent!

90 % of the French B to B debtors with unpaid bills are solvent but the success rate of the debt collection agencies and organizations in charge of the receivable collection are largely lower.
What are the reasons?
First of all it’s the way the debt collection industry is organized. The no cure, no pay policy largely practiced brings a focusing from the collector on the larger files. To collect 100 € or to collect 1.000 € it’s the same job, the same time investment but not the same earning. The market (the companies’ client of the debt collection agencies) would never accept to pay a 10 time higher fee to collect a small invoice. The bigger the file the more the debt collection specialist invest time and costs on it.
Other reasons in France are the difficulties to get legal decisions with acceptable fees for the benefit of the creditor. The French government is actually thinking about new dispositions in favour of the reduction of the payment terms. To apply the existing laws would be very helpful and sufficient. For some mysterious reasons some courts are very sensitive for the matter of the recovery costs. We don’t need new laws we need first the application of the old ones.
How to reduce the gap between the 90 % solvent debtors and the percentage of collected files is the goal of the debt collection industry in the near future. It’s difficult to accept that billions of overdue disappear every year because we are missing adapted tools and services.
Georges Vonfelt
www.gevo.fr