One of the aspects of debt collection to remember are the rules of contact. In the United States, permissions were recently granted to contact customers with debt via social media or email. This was the first big change in these rules in decades. In Canada, however, there’s been no modifications to the laws that have been on the books for several years now.
It’s always a good idea to take into account the legal guidelines when it comes to a business’ right to collect debt. As the official government site of Canada points out, there are specific rules in place for businesses who are collecting debt from customers. Here’s a quick look at what’s in the rulebook.
Hours are limited for debt collection
At this point, debt collectors can contact a person between 7 am and 9 pm Monday through Saturday, and between 1-5 pm on Sundays. Holidays are strictly forbidden for debt collection calls. Collection agencies also aren’t allowed to call customers on their cell phones, unless that is the only contact number provided.
Debt collectors also have to follow rules about who they can contact. Under Canadian rules, they should only be seeking a telephone number or address from friends, relatives, neighbors or employers. There are some exceptions to this particular rule:
- Collectors can contact the person who co-signed on a loan
- Collectors can contact employers if they need to confirm employment
- Collectors can contact financial institutions to which customers have given consent. This consent must be in written or electronic form.
It’s not only what you say, but when and how
Under the rules of contact there are some additional rules that go beyond just times and people. Among them:
- Collectors can’t suggest to anyone they contact that a person pay off their debts. The exception is the loan co-signer.
- No abusive, threatening or intimidating language can be used.
- No reasonable pressure can be applied for repayment.
- Collectors cannot give false or misleading information, or misrepresent the situation.
We believe that with these rules in place, debt collection can still be done with customer service and empathy at the forefront. It’s still important to put yourself in your customer’s shoes while providing the chance for them to resolve their debt with your business.
At ARO, we can help you navigate all the rules concerning debt collection, and we make it our purpose to reconcile debt with an approach that puts people first. Find out more about what we have to offer businesses on our website.
