BPO
Collections and arrears management
Amicable-stage recovery, within the confidentiality and conduct limits the rules actually impose.
In summary: arrears management and early-stage debt recovery, acting as processor on the creditor's behalf. The debt is never disclosed to third parties, and inclusion in a credit information system carries strict legal requirements that the creditor is responsible for satisfying.
In collections, pressure on the debtor and regulatory compliance pull in opposite directions, and it is worth saying which side we are on. The practices that apply the most pressure (disclosing the debt to the debtor's circle, repeated unwanted contact, announcing actions that cannot lawfully be taken) are precisely the sanctionable ones.
A provider promising to recover more because it pressures more is offering to take on a risk that ends up being the creditor's, and its own.
What is included
Amicable stage, before any judicial route.
- Contacting the debtor by phone, email and agreed channels
- Identifying the entity that owns the debt in every communication
- Information on the payment procedure and options for regularising
- Negotiating deferrals and instalments within your criteria
- Identity verification before discussing any detail of the debt
- Traceability of all actions and responses obtained
- Reporting on recovery, payment promises and reasons for non-payment
What is not included
This list is deliberately explicit.
- Disclosing the existence of the debt to family, neighbours, colleagues or any third party
- Pressure through visible elements revealing debtor status
- Announcing legal action that cannot lawfully be taken
- Repeated unwanted contact beyond what is justified to enforce the obligation
- Pursuing debts we cannot evidence as certain, due and payable
- Judicial proceedings, which belong to professionals appointed by the creditor
- Legal advice to either the creditor or the debtor
Where it is delivered from
In Spanish, from the Latin America corridor or an onshore team in Spain, depending on the portfolio profile and the type of data handled.
Collection files contain the debtor's personal data and frequently information about their financial situation, so the hub decision is worth taking with the transfer analysis done rather than afterwards.
Framework applying to arrears management
Where we manage the debt on the creditor's behalf we act as processor. According to the Spanish Data Protection Agency itself, a collection company's access to the data in that situation does not constitute a disclosure of data and requires no consent from the debtor, but it does require the processing agreement provided for in Article 28 of the GDPR. The position differs if the portfolio is purchased: the buyer then becomes the controller.
Every communication must state the name of the entity that owns the debt and the payment procedure.
Confidentiality towards third parties rests on Article 5.1.f) of the GDPR. Revealing debtor status to the person's circle in order to pressure payment is the practice that most clearly breaches that principle.
On inclusion in credit information systems, Article 20 of the LOPDGDD requires the debt to be certain, due and payable and not subject to challenge; that the creditor has given notice of possible inclusion; that the system notifies the individual within thirty days; and it sets a maximum of five years from maturity. It is for the creditor to guarantee those requirements are met, and creditor and system are joint controllers.
On aggressive practices, the applicable framework is Law 3/1991 on Unfair Competition, covering harassment and coercion, home visits after being asked to leave, and repeated unwanted approaches by distance means.
One useful precision, because the opposite circulates widely: the General Data Protection Regulation does not mention debt recovery in its recitals. Legitimate interest in recovering a debt does hold, and the Agency has recognised it in a legal report, but it is not worth resting on a citation that does not exist.
This is general information and not legal advice. We work alongside your advisors.
Frequently asked questions
Can you contact the debtor's family or workplace?
Not to communicate the debt. Revealing debtor status to third parties breaches the GDPR's confidentiality principle, and it is one of the practices the Agency has sanctioned. If the person is located by another route, nobody else is told the reason for the contact.
Can you list the debtor in an arrears file?
Listing is done by the creditor or the system, not by us, and requires the debt to be certain, due and payable, not under challenge, and for the individual to have been informed beforehand. It is for the creditor to guarantee those requirements, and it answers for their absence or inaccuracy.
Is the debtor's consent needed to manage their debt?
No. Acting on the creditor's behalf we are a processor, which is not a disclosure of data. What is needed is the Article 28 processing agreement and a valid legal basis held by the creditor.
What if the debtor disputes the debt?
The dispute is recorded and passed to the creditor. A debt under challenge does not meet the requirements for inclusion in a credit information system, and continuing to pursue a debt whose existence is not evidenced is precisely what has led to sanctions.
Do you follow any sector code?
There is a sector code for collection companies with useful good practices, such as not mentioning the debt on the outside of an envelope or verifying identity before speaking. It is worth saying that this is self-regulation binding on member firms, not generally binding law.
Do you handle judicial proceedings?
No. We work the prior amicable stage. Judicial proceedings belong to professionals appointed by the creditor, and that is your decision.
Want to recover early-stage debt without taking on regulatory risk?
Tell us the portfolio profile, average age and the contact channels available.