Why do banks need to outsource collection?

1. In terms of collection, banks also need to consider the costs and consequences, from making a few phone calls to taking legal action. If you really take the legal route, it will take time and money, and the process will be very long. Finally, even if the court decides that the debtor is in debt, people are helpless even if they don't pay back the bank. If the amount is large, the court will sentence the debtor to jail, and the bank will still not receive the money. This is also the reason why banks would rather find a collection company than go to court. On the one hand, the cost is low, on the other hand, the effect is better and the speed is faster.

The bank is very cautious. Even if a third party is found to collect money from the company, the cooperation fee to be paid to the third party company does not need to be paid by the bank itself, but is deducted from the interest, overdue, liquidated damages and late fees owed by overdue customers. If the bank can send an outsourcing collection company to collect the money, the money owed will not be hundreds of thousands, ranging from 30 thousand to tens of millions. Such a large sum of principal, because the overdue expenses are quite high, as long as it can be successfully recovered, the money paid to the collection company is of course a small amount.

3. Banks are places to borrow money and save money, and collection is not the main business of banks. If the bank also sets up a collection team for these people who owe money, the cost is not cost-effective, because under normal circumstances, there are not many overdue customers in a bank, and there is no need to go to great trouble to set up a collection team. Moreover, it is easy to have conflicts with debtors when collecting money, and banks are absolutely unwilling to bring unnecessary trouble to themselves. So this kind of hard work can be handed over to a third-party collection company, which is easy and simple.