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Making Contact With a Debtor

16 April 2018 No Comment

Collecting debts can be a tricky business. However, the following are some key areas to consider when making contact with a debtor:

– Some basic definitions

– Basic tenets of contact

– Purposes of contact

Key Definitions


The term ‘debtor’ includes an alleged debtor, and the term ‘debt’ includes an alleged debt. The term ‘debt collector’ includes creditors, independent collection agencies, collections departments within businesses, debt purchasers, assignees, agents, lawyers, government bodies engaged in trade or commerce, and other persons3 collecting on behalf of others.


‘Contact’ with the debtor or other person is interpreted widely. It includes, but is not limited to, the following:

  1. Communications by phone—including circumstances where the recipient (debtor or other person) elects to terminate the call, or where a voice message is left on a recording device, or where a message of any kind is delivered to the recipient (for example, text message).
  2. Communications in writing—including all written correspondence (for example, letter, email, text message, fax, social media application or program, instant chat, phone application, or any other similar device).
  3. Communications in person—including face-to-face contact, whether at the home of the debtor (or other person), workplace, or other location.

Basic Tenets of contact

  • Under the privacy laws, you have obligations to protect the privacy of debtors. When making direct contact, your first task must always be to ensure the person you are dealing with is the debtor. This must be done every time you make contact before you divulge any information about the debt, the process for its recovery or before providing any other confidential information.
  • The limits on disclosing information to third parties apply to the debtor’s spouse, partner and/or family as much as they apply to other third parties.
  • Having established the debtor’s identity, you should then identify who you are, who you work for and explain the purpose of the contact. Failing to clearly identify who is calling and the purpose of the call will most likely confuse the debtor and may lead to the debtor avoiding subsequent calls.
  • If you elect to use emerging technology to attempt to or make contact with the debtor, you should carefully consider the particular channel and its potential audience. It may be acceptable to attempt contact via emerging technology provided:
    1. you have a reasonable belief that contact will be with the debtor
    2. you have a reasonable belief that the channel is not shared with other parties (for example, a shared work email address or joint social media account).
  • You should avoid contacting the debtor via a certain channel (whether it is an emerging technology or a more traditional channel of communication) if:
    1. the debtor has specifically requested to be contacted through an alternate channel of communication, or
    2. the debtor specifically requested that this particular channel not be used.

Purposes of Contact

Communications with the debtor must always be for a reasonable purpose and should only occur to the extent necessary.

It may be necessary and reasonable for you to contact a debtor to:

  1. provide information to the debtor about their account
  2. make a demand for payment
  3. offer to work with the debtor to reach a flexible repayment arrangement
  4. accurately explain the consequences of non-payment, including any legal remedies available to the collector/creditor, and any service restrictions that may apply in the case of utilities (for example, disconnection of electricity or gas supply or restriction of water supply)
  5. make arrangements for repayment of a debt
  6. put a settlement proposal or alternative payment arrangement to the debtor
  7. review existing arrangements after an agreed period
  8. ascertain why earlier attempts to contact the debtor have not been responded to within a reasonable period, if this is the case
  9. ascertain why an agreed repayment arrangement has not been complied with, if this is the case
  10. investigate whether the debtor has changed their residential location without informing you, when there are grounds for believing this has occurred
  11. sight, inspect or recover a security interest
  12. or for other similar purposes.

You may also contact a debtor at the debtor’s request.

What constitutes a reasonable purpose may change according to the personal characteristics of an individual debtor. You should consider the information you have about each individual debtor in order to determine whether intended contact with that debtor will be for a reasonable purpose.

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