I’ve often asked, “Who’s the client?”—usually when agency demands feel out of step with the power dynamic. But it’s worth flipping the lens now and then. Creditors, too, should pause to reflect: Are we doing our part to build and sustain a strong vendor relationship?
It’s easy to talk about contracts, controls, and performance metrics. But the reality is, agency relationships are more than checklists and compliance. They’re operational, strategic, and—at times—emotional partnerships. And those partnerships require nurturing from both sides.
I recall an audit I conducted years ago, where the agency was clearly overwhelmed. I asked why they hadn’t flagged the volume issue to their client. Their answer? “We’d never tell a client we couldn’t handle more work. They’d stop sending us placements.” In truth, their silence cost them the relationship. They fell behind, performance suffered, and the client moved on—frustrated they hadn’t been told sooner. The agency feared losing business by speaking up, but lost it anyway by staying quiet. Actually, both sides lost.
That example underscores the complexity of vendor dynamics. Good relationships require transparency, mutual respect, and aligned expectations. And while agencies must perform, the creditor remains the senior partner in this arrangement. With that comes responsibility—to set clear expectations, support operational success, and build a culture of communication and accountability.
Below are six areas to evaluate your role in creating high-performing agency relationships.
Account Placement Quality
Agencies can’t collect what they can’t understand.
It starts here. Thoughtful, well-prepared placements are the bedrock of agency success. When placements are timely, scrubbed, and complete, agencies can ramp up quickly and deploy resources effectively. But if the data is inconsistent, incomplete, or confusing, your agency may spend more time untangling files than collecting dollars. While most clients take the placement process for granted, now is a good time to check to see if your placement process could use improvement. I’d start by asking your agency for any thoughts or suggestions in this area.
Ask yourself:
- Are placements sent on a predictable and consistent schedule?
- Do you scrub accounts for duplicates or prior vendor placements?
- Is all key data included (e.g., contact info, charge-off date, balance details)?
- Are accounts segmented logically (e.g., by product type, geography, or risk profile)?
A quality placement process is a signal of your commitment to the relationship. It sets the tone for what comes next.
Communication & Responsiveness
When your agency spends time chasing answers, they’re not chasing payments.
Even the best-designed recovery strategies can falter without strong communication. Agencies need clarity, direction, and timely responses. Gaps in communication breed confusion, delays, and missed opportunities. When auditing gaps in work effort, I have to admit – sometimes the last effort was “waiting for client response”. And too often, this queue just sits and isn’t worked, until the request for close. Establishing clear points of contact, defining escalation paths, and sticking to response-time SLAs can make or break a program.
Ask yourself:
- Do you respond to agency questions in a timely and consistent manner? And, what do you consider a reasonable response time?
- Is there a designated liaison who understands both internal and vendor needs?
- Are regular check-ins or performance calls part of your process?
Solid communication builds trust—and trust drives performance.
Compliance & Policy Sharing
Don’t make them guess. Compliance starts with clarity.
Regulatory compliance is complex, critical and changing, with more focus on state requirements. In addition to state and federal requirements, agencies want to comply with your standards—but only if they know what those standards are. From call frequency to security and PII handling, vague or outdated policies increase the risk of noncompliance and inconsistent service. When you clearly communicate expectations and update them proactively, you enable your agency to operate with confidence and precision.
Ask yourself:
- Have you shared current servicing expectations and compliance protocols?
- Are your security, data destruction and PII handling expectations clear and up-to-date?
- Do you provide updates when interpretations or regulatory guidance change?
Remember: the better you define the guardrails, the smoother the road.
Reporting & Performance Feedback
Good clients give good feedback—consistently and constructively.
Agencies need regular, structured feedback to improve. Without it, they’re left to guess what’s working and what’s not. Implementing scorecards, KPIs, and quarterly reviews creates a rhythm of accountability and growth. And don’t forget: positive reinforcement is powerful. Praise, when earned, is just as important as critique.
Ask yourself:
- Do you conduct formal performance reviews on a regular basis?
- Are you sharing both concerns and compliments?
- Do you use scorecards or dashboards to benchmark agency performance?
Call monitoring calibration sessions can be especially valuable to align expectations and reinforce training themes. Getting all the players together, collectors, supervisors, agency management and client representatives for a call calibration can be an extremely effective format for communicating expectations, as well as provide opportunities for praise, and potential training issues. These types of call calibration meetings can be quick opportunities to build and enhance the strategic partnership of the agency/creditor.
Fee Structure & Incentive Alignment
A rate that’s too low may save pennies now but cost dollars later in poor performance and disengaged vendors.
Your compensation model tells agencies what matters most. If your program prioritizes compliance, brand protection, and customer experience, your fee structure should reflect those priorities. Undervaluing vendor contributions often leads to disengagement—or worse, corner-cutting. Build in performance incentives, preferred status, or bonus structures where appropriate, and revisit them periodically to stay competitive.
Ask yourself:
- Is your contingency rate fair and aligned with industry benchmarks?
- Do you reward performance in ways that matter to the agency?
- Do you quibble about whether the agency earned the money if they collected it too easily?
- Have you looked at costs and approval processes when appropriate?
- Have you revisited your fee structure in the last 12–18 months?
Low rates might save you short-term dollars but can cost you long-term results.
Dispute & Complaint Management
Handled well, complaints can strengthen—not strain—the relationship.
Complaints are inevitable. How you handle them—together—matters. Establishing clear resolution protocols, defining response timelines, and analyzing root causes together helps identify systemic issues and prevent recurrence. Transparent dispute processes not only protect your institution—they reinforce your role as a thoughtful, engaged client.
Ask yourself:
- Is there a clear, documented process for complaint resolution?
- Do you regularly review complaint trends with your agencies?
- Do complaint trends indicate any areas for change or process improvement?
- Are corrective actions mutually agreed upon and tracked?
Shared accountability is a hallmark of a strong client-vendor relationship.
Conclusion: Your Role, Your Results
A successful collection vendor relationship doesn’t begin and end with a signed contract. It’s a living partnership—one that demands alignment, accountability, and communication.
While it’s natural to focus on evaluating the vendor, the real leaders in this space take a harder look inward. They ask not just, How are they doing?—but How are we doing as their client?
The best-performing institutions don’t simply manage vendors—they collaborate with them. They support with structure, respond with purpose, and lead with clarity. If you want your agencies to deliver their best, show them what “best” looks like from your side, too.
So before your next RFP, monthly scorecard review, or Quarterly Business Review, take time to rate yourself as a client. Evaluate the data you share, the feedback you offer, the expectations you set, and the example you lead with.
And don’t be afraid to ask your vendors for their perspective.
Open the door for real dialogue—it’s often the first step toward real improvement.
In the end, great results come from great relationships. And great relationships start with a great client.
Resource Management Services, Inc. provides consulting on collection and vendor management topics.
With expertise and experience in collections, oversight and compliance, we understand the challenges faced by creditors in managing collections and recoveries while adhering to ever-evolving regulatory standards.
That’s why our team of seasoned experts is dedicated to providing tailor solutions that address your unique collection and compliance requirements.
From comprehensive consulting services to specialized training programs and meticulous oversight of third-party vendors, we offer a comprehensive suite of services designed to empower your team and optimize your compliance strategies.
Contact our blog authors or Write to us at info@resourcemanagement.com for more information.
www.resourcemanagement.com
Author: Judy Hammond
judy.hammond@resourcemanagement.com
Judy Hammond is founder and President of Resource Management Services, Inc. The corporation was founded in 1986 and specializes in auditing and consulting, serving the collection and recovery industry. As President of Resource Management Services, Inc., she has more than 35 years of experience with an emphasis on operational reviews for compliance and operational effectiveness of collection operations, both for creditors’ internal collection and recovery operations as well as collection agencies and attorneys. She has worked with top banks and financial institutions, utilities, credit unions and telcoms, (and their vendors) and has conducted many Best Practices projects. She is author of various industry publications: “Comprehensive Agency/Attorney Usage Study,” “Comprehensive Agency/ Attorney Usage Study II” and “Collect More From Collection Agencies”. Her work with creditors who were looking to sell debt for the first time, and subsequent Buyer/Seller research was the foundation for the second corporation, The Debt Marketplace, Inc. She worked with Dennis Hammond as co-founders of the Debt Buyers’ Association, (now RMAi), building the foundations for industry standards, as well as the original code of ethics. She developed and produced two industry conferences, Collection and Recovery Solutions and Debt Connection Symposium & Expo, from their inception in 2002 and 2006, respectively, to 2022. Prior to starting her own company, she worked with two large collection agencies.
