How Does Debt Collection Work?

A simple introduction to the debt collection process to help you collect lost revenue.

If your business or practice needs help collecting revenue from past-due consumers, you probably have a lot of questions about the debt collection process.

When accounts go unpaid, many businesses turn to a debt collection agency for help. A reputable agency with decades of experience and modern tools can recover lost revenue while protecting your reputation. Whether you’ve partnered with an agency before or this is your first time, IC System simplifies the process and acts as a trusted extension of your office. Here’s how our agency’s transparent, efficient, consumer-friendly debt collection process works.

Step 1: Choose the Right Program for Your Organization

The process starts when your business, as the creditor, decides to recover past-due balances. This is where a debt collection agency like IC System comes in with solutions.

Step 2: Begin Fast and Easy Account Placement

Your business hires a debt collection agency because they have the proper experience, knowledge, technology, and resources to be effective. Agencies understand the nuances of how debt collection works, so you don’t have to.

Step 3: IC System Performs Our Strategic Debt Collection Process

The debt collection agency works as an extension of your business. The creditor (your business) hands over information on past-due accounts, and then it’s the agency’s job to contact the consumers and work out a plan to get the invoices paid.

Step 4: Provide Ongoing Strategy and Support for Client Success

When you choose the right partner, ongoing support keeps the process consistent and transparent. Regular reviews, data insights, and strategy updates help maintain strong recovery performance over time to ensure happy outcomes for everyone.

How Does The Debt Collection Process Work With IC System?

IC System is an agency that approaches the debt collection process as a partnership built on trust and transparency. Every step is designed to help clients recover revenue while protecting the relationships they’ve built with their customers.

What makes IC System different:

Proven process. Decades of experience have shaped a workflow that begins with secure data exchange and continues through precise, compliant outreach.
Compliance leadership. All collection activity follows the Fair Debt Collection Practices Act and applicable state regulations, reducing risk for every client.
Advanced technology. Predictive analytics, skip tracing, and credit monitoring tools guide outreach strategies for stronger recovery results.
Consumer-friendly approach. Representatives communicate with respect and clarity to preserve your reputation and encourage voluntary resolution.
Transparent partnership. Clients can monitor activity and review reports through IC System’s secure online portal.

Here’s how the debt collection process works when IC System is your agency partner:

Step 1

Choose the Right Program for Your Organization

IC System is proud to offer their clients flexible debt collection programs to choose from based on their needs. We’ll work with you to choose the best debt collection process for you.

InstiCollect: Easy online setup. Collections begin in one business day.

Ideal for:
Businesses with one debt or up to 50 debts a month that want to get started today.

Approach:
Begins with collection calls and written correspondence (letters, emails, texts) while still using a consumer-friendly tone.

Fee Structure:
Businesses only pay their low contingency fee if debts are successfully collected. $75 setup fee.

Recovery Plus: Two-Phase Flat Fee Collections

Ideal for:
Businesses that want their past-due consumers to receive soft collection efforts before traditional activity begins.

Approach:
Begins with a letter-only phase. Second phase is an intensive but consumer-friendly approach with follow-up letters and calls.

Fee Structure:
Flat fee.

Additional Options:

Settlement Authority

You can decide to assign settlement authority to your debt collection partner, giving them the legal authority to settle with borrowers on your behalf.

Credit Monitoring

Credit monitoring provides notification when there is a change in a borrower’s credit that indicates repayment may be feasible. These changes include events such as opening a new tradeline, a loan payoff or similar credit event.

Credit Reporting

Not all accounts are eligible for credit reporting, but creditworthiness can be a powerful incentive when it comes to the debt collection process. When your partner has access to the credit reports of your borrowers, they can use the information to help facilitate repayment.

Non-Litigation Attorney Referral

When all other means are exhausted, a non-litigation attorney referral creates urgency with calls and letters on IC System’s behalf.

Litigation Referral

Once non-litigation attorney referrals are complete, a review of the account will determine if litigation is a viable option. This is reserved for high balances in which repayment is deemed possible.

Learn more about choosing the right product.

Step 2

Begin Fast and Easy Account Placement

Account placement starts when you choose a collection program and upload accounts through IC System’s secure Client Portal. Acting as a trusted extension of your office, we begin outreach with a consumer-friendly tone that protects relationships and reflects your business values

Upload accounts receivable electronically via our secure Client Portal

Collection efforts begin within 1 business day

Load accounts by file or individually

Step 3

IC System Performs Our Agency’s Strategic Debt Collection Process

IC System operates under strict federal and state requirements that define how debts are verified and how consumers are contacted. The Fair Debt Collection Practices Act sets national standards for fairness, and state regulations add local requirements for notices and documentation. Together, these laws guide and ensure every account is handled with accuracy and respect.

Ensure Accuracy with Data Scrubbing and Optimization

Better results can be achieved with better data. Our experienced team helps prime your records for success:

Data Scrubbing:
Clean information ensures accuracy and focuses our efforts on real accounts and contact information

Optimization:
Our intelligent analytical models help us achieve maximum account penetration and recoveries on your behalf

Proven Collection Strategy Begins

Our collectors—highly trained in manner, compliance, and law—execute the program you’ve chosen using the following tactics:

Written Correspondence:
Validation notice and additional letters, emails, texts

Calls:
Staggered attempts informed by data-driven insights

Skiptracing:
Locate consumers, update contact information, track credit activity

Additional Options:
Credit reporting and litigation referral when appropriate

Step 4

Provide Ongoing Strategy and Support for Client Success

Help Center

Our informative Help Center gives you walkthroughs and tips to help navigate the Client Portal and improve recoveries

Technology and Tools for 24/7 Access

Access your inventory 24/7 with our intuitive Client Portal

Review notes and checks progress on our debt collection process

Post payments online

Update new account information