Debt collection (inkasso)
Also known as debt recovery, collection of receivables, inkasso, inkassation, inddrivelse, gældsinddrivelse, fordringsinddrivelse
Debt collection is the recovery of a due money claim that the debtor has not paid despite reminders.
In practice
Debt collection covers two tracks that are often confused. Out-of-court collection is everything that happens without the courts: the collection letter, the telephone call, the instalment plan. Court-based collection is when the claim is taken to court to obtain an enforceable instrument, so that it can be enforced through the bailiff’s court.
Most cases end in the out-of-court track. A letter from an authorised collection agency with a lawyer behind it moves far more debtors than the creditor’s own third reminder — not because the tone is harder, but because the consequence is now concrete.
Collection may only be carried on by a party licensed by the police, or by a lawyer. That is not a formality: collecting without authorisation is a criminal offence, and the costs imposed on the debtor cannot be recovered from him.
Where it commonly goes wrong
- Collection is started too early. A formal demand with at least 10 days’ notice must have been sent before the case may be handed over. Skip it, and you carry the collection costs yourself.
- The claim is not documented. If the debtor raises an objection, the case cannot proceed as an ordinary collection case. The basis must then be capable of being produced: the agreement, the delivery, the invoice.
- Too long is allowed to pass. A claim that is a year old is recovered markedly less often than one that is 40 days old. Time never works for the creditor.