How Much Does a Collection Agency Cost?
If you are considering hiring a collection agency, cost is one of the first things you want to know. Optio Solutions is a nationally licensed debt collection agency founded in 2007 that works with creditors across industries to recover more of what is owed while protecting customer relationships.
The reality is, there isn’t a standard fee that applies to every situation. The cost depends on the type of accounts you place, how long they’ve been past due, and the recovery approach that best fits your business goals.
Two Common Ways Collection Agencies Charge
- Contingency Collections
- You pay only when the agency collects.
- The fee is a percentage of the recovered amount.
- Often used for accounts that are significantly past due and need professional recovery efforts.
- Flat Fee or First-Party Collections
- You pay a set amount per account placed, regardless of outcome.
- Often used for early-stage collections when preserving customer goodwill is a top priority.
- Ideal for organizations that want to outsource payment reminders without aggressive collection tactics.
- Ideal for organizations that want to outsource payment reminders without aggressive collection tactics.
What Affects the Cost of Collections
Several factors influence how much you’ll pay to recover outstanding balances:
- Age of the debt: Older debts can take more time and resources to recover.
- Account balance: Lower-balance accounts may be priced differently than high-balance ones.
- Number of accounts placed: Higher volumes can qualify for preferred rates.
- Industry requirements: Regulated industries may require specialized compliance measures.
Why Paying for Collections Can Be Worth It
Partnering with the right collection agency can increase your recovery rates compared to in-house efforts, especially once accounts are more than 90 days past due. A professional agency can also help your business:
- Save time and staff resources.
- Reduce compliance risks.
- Maintain positive customer relationships while recovering funds.
Real-World Example: Retail Credit Card Collections
A national retailer with a large customer base partnered with Optio Solutions to recover past-due balances on store credit card accounts. Optio implemented a compliant outreach program tailored to the retailer’s customer profile and brand voice. The result was the successful recovery of delinquent balances while preserving customer relationships and protecting the company’s reputation.
Protecting Your Brand While Improving Recoveries
Optio Solutions provides:
- Licensing to collect in all 50 states.
- Compliance with all federal and state regulations.
- Customized recovery strategies based on your industry, customers, and goals.
- Options for both early-stage and late-stage collections.
Taking the Next Step
If your organization has accounts that are 60 days past due or older, now is the time to evaluate your recovery strategy. The right partner can help you collect more of what you’re owed, faster, while safeguarding your brand.
