How Much Do Debt Collectors Charge?


When a company or individual owes your business money, a quick and easy way to recover the funds is by contacting a licensed and experienced debt collection agency that will chase up the debt on your behalf.

Debt collection agencies can take away the stress, hassle and time it takes to recover unpaid accounts so you can focus on your business.

But how much can you expect to pay a debt collector to recover your funds?

This can vary a lot and most times the size of the debt will determine what percentage of the debt a collection agency will charge.

Tip: Did you know there is a way that you can make the debtor legally liable for your collection expenses? I’ll explain a little more about how to do this in a minute, but first let’s look at what you need to be wary of when choosing a collection agency.

Do They Offer A No Recovery, No Fee Policy?

Every good collection agency will offer a No Recovery, No Fee service. This means that you can register your debt with the agency and they will go through their system for recovering the debt for free. You only pay if they successfully recover the outstanding money and the fee is deducted from the recovered funds.

This is especially handy when you have written off a debt, because you can start the recovery process without the risk of incurring expenses.

Do They Offer A Membership Service?

If you have a large outstanding account or often have to chase up unpaid invoices you may benefit from paying an annual fee to a debt collection agency in return for a lower percentage fee on each individual debt.

This could save you a lot of money if you believe that you will be using a debt collector on an ongoing basis.

JMA Credit Control offers membership for just $250/year. This fee will quickly be recovered if you have multiple or large unpaid accounts. (More details in the table below)

Does The Fee Include Solicitor Letters?

Often during the recovery process you will need to issue the debtor a Letter of Demand. These are much more effective when written on a legal letterhead from a solicitor. You will want to check that these solicitor letters are included in your fee and it is also important that the agency has an in-house solicitor who can offer professional legal advice if the dispute needs to go to court.

What Is The Minimum Amount They Will Recover?

Some agencies will only take on debts of over $5000 or more. At JMA Credit Control we understand recovering smaller debts is important too so we will recover debts as little as $1000.

How Much Do They Charge? Debt Collection Fees and Pricing.

As mentioned earlier many collection agencies charge based on a percentage of the recovered fees. It is industry standard that small debts have higher % fees to make it worth the company’s time.

Here’s the fee structure for JMA Credit Control, who offer some of the lowest rates in the industry.

You have two options:

  1. No Collection = No fee:
    Commission scale(based on the total debt)
$0 – $50025%
$501 – $1,00020%
$1001 – $5,00012.5%
$5,001 – $20,0007.5%
Over $20,0005%


  1. Pay an Annual fee of $250.00:
    Reduce your commission fees
$0 – $50015%
$501 – $1,00012.5%
$1001 – $5,0007.5%
$5,001 – $20,0005%
Over $10,0003.5%


So as you can see the collection fees are very affordable, especially when you consider the No Recovery, No Charge risk free offer.

How To Get Your Debts Collected For Free

If you are pro-active and have your Terms of Trade professionally written, documented and communicated, you can include a clause in your quotes and credit application that states that any recovery fees you incur will be recoverable from the debtor.

Ensuring that your customers read and sign off on these terms at the start of a transaction means the debtor will be legally liable for any fees incurred when chasing up the unpaid debt. The fees will simply be added onto the recovered debt and you will have no out of pocket expense.

If you currently have an outstanding debt and would like to have a no-obligation chat with a debt collection expert please contact us here.



4 comments on “How Much Do Debt Collectors Charge?

  1. Jo on

    We are small business in Rockhampton. We have a large company who owes $4879.75. We have tried on several occassions and replied to all their requests. Still nothing ! can you please send an Authority to Act as agent form.

  2. Paul Piadang on

    Hi. I have a cleaning business and my customer doesn’t want to pay $350. I know its small amout but even its not worth to do but i like to do something with this kind of person.


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