The Importance of a Credit Policy Review

credit-policy-reviewWe talked about the Consumer Financial Protection Bureau and their proposed rulemaking for the debt collection industry in an earlier post. It is important to note that this proposed rulemaking will affect not just debt collection agencies; it will also affect the original debt owner – the creditor. The CFPB is focusing on data integrity to make sure collection agencies are receiving accurate data from their clients before they begin the collection process.

The CFPB states that “the most common debt collection complaint received by the Bureau concerns collectors seeking to recover from the wrong consumer or in the wrong amount.” They further state that they believe this stems in large part from “substantial deficiencies in the quality and quantity of information collectors receive at placement of the debt.”
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Debt Collectors Support Financial Literacy

A college education is a huge financial commitment parents make in order to optimize their child’s chances at a better future.  If possible, parents would like for their child to contribute some money to ease the burden.  One way for a student to help out is by earning a scholarship.

Scholarships come in a variety of forms, including essay contests.  The California Association of Collectors (CAC) gives high school seniors in California a chance to compete for a scholarship.  The California Association of Collectors Educational Scholarship Fund (CACESF) is an annual scholarship awarded to the top three students who submitted the best essays about topics that include finance and credit.  This year’s prompt was to write an essay on the “Importance of Establishing and Maintaining Good Financial Credit During Your College Years”.

This year’s competition had nearly 800 applicants that were eventually narrowed down to the three finalists: Ethan Turner (2nd place), Katie Clark (3rd place), and Kasania Khachadourian(1st place).  T2014winners2he CAC awarded all three students scholarships, but Kasania walked away with the first place prize of $2,500.  The CAC has already awarded $54,000 to California high school seniors since the foundation started in 2005.

The scholarships given to the students are funded by participating CAC members.  One of the top contributors to the scholarship is Credit Consulting Services (CCS).  As an intern at CCS, I am glad to be a part of a company that not only funds this scholarship, but also supports financial literacy.  Much like a doctor teaches you how to maintain your body to avoid a health crisis, a goal of the CACESF and CCS is to teach young people how to be financially literate to avoid a future debt crisis.

The scholarship is not simply a monetary award.  It teaches participants how to be financially literate while also encouraging eventual financial independence.  The years spent in college go beyond the education one receives in the classroom.

For myself, this past year as a freshman at USD was the first time I was independent of my parents.  I learned how to be responsible of my own finances, but it was through a trial and error process.  For instance, I knew how to budget time but I didn’t know how to budget my funds.  This program teaches students to be financially responsible in order to avoid credit debt.  If I had known about CACESF I could’ve entered college more financially literate and maybe even earned a scholarship.

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Collection Training

We received excellent feedback on our last webinar “Steps for Improving Collections“. Credit Consulting Services next webinar will focus on “Effective Collection Techniques” and “8 Steps to an Effective Collection Call“. Anyone who wants to improve their internal collection skills, collect more money, and reduce bad debt while maintaining good customer relations will want to attend this webinar. You can register by visiting our main site at www.creditconsultingservices.com.

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