A repayment of a loan can be rejected by the borrower or the borrower's bank within the 5 working days after the date of direct debit. When this happens, the first step is to recover the funds through amicable recovery.
The objective is to bilaterally recover the amount due without judicial intervention. This phase can last a few weeks.
Who is in charge of amicable recovery?
October’s local recovery team (2 persons in 🇫🇷, 1 in 🇪🇸, 1 in 🇮🇹 and 1 in 🇳🇱) is in charge and will reach out to the company to understand the reason of the delay. Together with the borrower they’ll try to find ways to recover the outstanding debt. Depending of the situation, October can outsource the recovery process to an external recovery agency.
What can be the outcome?
There are three possible outcomes after we contacted the company:
- The company regularises the situation immediately.
- The company cannot complete the repayment immediately or within a few days after the rejected direct debit. In this case, we investigate the underlying cause and work closely with the company’s management to find a solution. If the borrower collaborates and is proactive, we can agree on debt rescheduling. This gives the company time to normalise its cash flow, recover from its temporary issue and avoid default.
- We do not manage to contact the company or the company does not cooperate despite our repeated attempts to reach out to them. We transfer the project to the external recovery partner. The recovery partner is dedicated to recovery. Their actions range from calling borrowers to sending emails and formal notices, etc.
Amicable recovery can last a few weeks. During the process, the Recovery Team updates the activity page of the projects in default, giving information about the reason of the delay and the recovery actions taken. You will receive the update by e-mail on the day of its publication. You can filter on loans in default in the Loans section of your portfolio and view their history. Learn how to monitor your projects.
As much as possible, we try to recover the money through amicable recover. If it fails, the case is moved to judicial recovery.