Selecting a Collection
Agency in Canada

15 Reasons to Use Priority Credit

Collection Comparisons in Canada vs USA

If your company carries Canadian trade receivables, it's inevitable you will require the debt collection services of a licensed Canadian collection agency. When that day comes being aware of the correct procedures to collect debt in Canada from Canadian business and consumers will give you the best chance for success without running into a myriad of legal problems.

Many US collection agencies claim they can collect in Canada. In reality, very few can do it legally.

The Canadian version of the FDCPA includes commercial as well as consumer debt and is enforced at the provincial level.

Collection agencies engaged in Canadian debt recovery must meet the following criteria:

1. Hold a valid provincial agency license
2. Maintain yearly audited financial statements
3. Post minimum bond requirements by province

This criteria is common amongst all Canadian provincial legislation, however there are many other requirements per province that are not mentioned.

If your company is serious about developing and maintaining long term business transactions in Canada, it is strongly recommended that you engage the services of a professional debt collection agency that is legally entitled to work in Canada. Ask your agency for copies of their provincial licenses and bonds. It may make good business sense to retain a Canadian collection agency directly to avoid the potentially higher commissions charged by US agencies for international accounts.

Due diligence should be exercised when choosing a Canadian collection agency.

Here is a simple 8 point checklist that an agency collecting in Canada should have as a minimum:

1. Are they licensed in the jurisdiction where your customer operates?
2. Do they belong to a professional industry association such as the International Association of Commercial Collectors (IACC) or ACA International (ACA)?
3. Does the agency maintain Errors and Omissions insurance?
4. Is the agency capable of reporting to all credit reporting agencies in Canada?
5. Does the agency maintain a US dollar client trust account to avoid currency exchange problems?
6. Can the agency provide secure web access to your accounts to assist you with Sarbanes-Oxley compliance?
7. Does the agency provide a North American toll free telephone number?
8. Do agency personnel speak fluent English?

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 Northwest Territories neither a collection agency nor a collector shall communicate with a debtor after the debtor has advised the collection agency in writing to communicate only with the debtor in writing and the debtor has provided the agency with an address where the debtor may be contacted. In British Columbia when a debtor has notified a collector and the creditor that the debt is in dispute and the debtor wants the creditor to proceed with legal action, any further calls are illegal. When this situation occurs there are only 2 options-sue or close. 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 the Province of Alberta (AB) a personal guarantee MUST be notarized or sworn before a Commissioner of Oaths to be valid In the Northwest Territories a collection agency cannot state an intention to sue a debtor unless it has express written authority to sue the debtor, and a collection agency cannot recommend to a creditor that a lawsuit be commenced for the purpose of collecting a debt unless the collection agency first notifies the debtor of the collection agency's decision to make this recommendation.