Selecting a Collection
Agency in Canada

15 Reasons to Use Priority Credit

Collection Comparisons in Canada vs USA

For some US companies Canada is a new market and they outsource their accounts receivable. Like any expansion, accounts receivable or AR outsourcing can bolster market penetration, while creating an additional revenue stream. However, an ounce of prevention is worth a pound of cure, is accurate when setting up an accounts receivable department for Canada to support sales and operations.

With 10 provinces and 3 Territories Canada has diverse provincial financial regulations when it comes to extending credit. AR outsourcing or accounts receivable management often eliminates costly headaches like a credit contract or agreement in one province that is void in another province. In some provinces a personal guarantee has to be notarized, while in others it only needs to be clearly identified as a personal guarantee. Depending on the creditor industry a whole spectrum of other factors can enter the picture. Outsourcing to someone who knows the terrain is critical and the main reason US companies outsource their Canadian account receivables.

Some American companies have operated in Canada for decades. With the economic climate in the United States a recent trend has been to centralize accounts receivable systems. Instead of maintaining a physical AR management operation, outsourcing is often the most cost effective way to maintain margins while maintaining efficient sales and operations support in Canada. Proper outsourcing uses industry-specific methodologies and practices to streamline your credit approval initiatives while improving your cash flow and limiting bad debt exposure

Even though every outsourcing project is different the company handling your accounts receivables should have expertise in the following areas:

1. Setting a detailed credit approval system
2. Credit adjudication of potential and existing customers
3. Establishment of credit policies and terms
4. Prompt Invoicing
5. Account reconciliations
6. Cash posting
7. Development of reminder procedures for slow-payers
8. Bad debt follow up
9. Implementation of credit hold policies
10. Hiring & termination of credit staff
11. Management & ongoing training of credit staff
12. Risk management
13. Documented Policy & Procedure compliance manuals (ISO, Sarbanes Oxley)
14. Training of sales staff on credit policy.
15. Fraud management protocols
16. Shared Services Concept

The outsourcing information above merely scratches the surface. If you have any questions or need more information, don't be afraid to ask. Simply click on the $ and choose your contact option 

In the Province of Alberta (AB) a personal guarantee MUST be notarized or sworn before a Commissioner of Oaths to be valid In Alberta a collector is only permitted to contact a debtor's employer for the sole purpose of confirming the debtor's employment status, title and business address as part of preparing a legal action. In Manitoba a collection agency is not permitted to use any form, including any generic collection letter that the Manitoba licensing administrator deems unacceptable. In Saskatchewan a collection agency shall not commence or continue a lawsuit for the recovery of a debt in the name of a collection agent as plaintiff unless the collection agency has purchased the debt for valuable consideration and the debtor has received notice of the sale of his account. In Manitoba BEFORE communicating with Manitoba residents a collection agency must hold a valid collection agency license issued under the Manitoba Consumer Protection Act.