Application
This unit describes the skills and knowledge required to research and analyse information to determine the debtor and debt settlement status of individuals or parties such as companies or associations, negotiate with debtors and collect debt.
It applies to individuals who perform debt collection functions within organisations of any size or location.
Work functions in the occupational areas where this unit may be used are subject to regulatory requirements. Refer to the FNS Implementation Guide Companion Volume or the relevant regulator for specific guidance on requirements.
Elements and Performance Criteria
ELEMENT | PERFORMANCE CRITERIA |
Elements describe the essential outcomes. | Performance criteria describe the performance needed to demonstrate achievement of the element. |
1. Plan and prepare initial contact | 1.1 Interpret and confirm client’s written instructions and any of their relevant policy and procedures 1.2 Review comments on debtor's file to enable initial action in line with own organisation’s policy and procedures, and legislative requirements |
2. Assess debtor | 2.1 Establish credit worthiness of debtor through compilation of valid and relevant credit history 2.2 Cross-reference information on debtor for verification, when necessary, by file or document search 2.3 Determine appropriate and cost-effective recovery action options based on debtor's verified credit worthiness |
3. Negotiate debt payment or settlement within defined parameters | 3.1 Use appropriate means of communication to establish contact and build rapport with debtor 3.2 Develop debt settlement proposal that attempts mutual satisfaction for client and debtor, applying negotiation techniques, organisational guidelines and appropriate industry codes of conduct 3.3 Discuss debt settlement proposal with management and document reasons for proceeding or not proceeding, or taking further action 3.4 Confirm and record debtor and creditor agreement, and procedures for debt settlement 3.5 Make decision to refer debt for legal action, if necessary, in line with organisational policy and procedures |
Evidence of Performance
Evidence of the ability to:
compile debtor's credit history
assess and establish debtor's credit worthiness
interpret and comply with legislative requirements, industry code of conduct and organisational policy and procedures relevant to debt collection
negotiate effectively to come to a satisfactory agreement and gain commitment from debtor to settle debt
complete relevant documentation in accordance with industry and organisational requirements and guidelines.
Note: If a specific volume or frequency is not stated, then evidence must be provided at least once.
Evidence of Knowledge
To complete the unit requirements safely and effectively, the individual must:
describe the negotiation process
outline and describe the basic business structure, financial arrangements and legal obligations of sole trader, partnership trusts and corporate businesses
provide basic information on securities, loans and principals, factoring, guarantees, indemnity, securities over property, retention of title and liens
outline creditor's obligations underpinning credit management functions and their relationship to mercantile agents
identify relevant state or territory and Commonwealth Acts and regulatory authorities regarding debt collection and mercantile agents
describe the role, procedures and relevant documentation of the various court jurisdictions and appeals procedures involved in debt collection processes.
Assessment Conditions
Assessment must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the mercantile agents field of work and include access to:
office equipment, technology, software and consumables
organisational records, policy and procedures.
Assessors must satisfy NVR/AQTF assessor requirements.
Foundation Skills
This section describes language, literacy, numeracy and employment skills incorporated in the performance criteria that are required for competent performance.
Skill | Performance Criteria | Description |
Reading | 1.1, 1.2, 3.1 | Interprets documentation from a variety of sources and consolidates information relevant to credit application |
Writing | 3.1, 3.3, 3.4 | Drafts reports and letters, and completes credit application records Records agreements and documents decisions during negotiations |
Oral Communication | 3.1, 3.2, 3.3, 3.4 | Uses language and concepts appropriate to the audience and purpose to convey and clarify information Uses questioning and active listening to determine and confirm debt and debt settlement requirements |
Numeracy | 2.1, 2.2, 2.3 | Accurately analyses, records and stores data in accordance with organisational requirements Calculates debt status and settlement payments |
Navigate the world of work | 1.2, 3.2, 3.3, 3.5 | Takes responsibility for adhering to organisational policy and guidelines relevant to own work context Recognises and follows explicit and implicit protocols |
Interact with others | 3.1, 3.2 | Selects the appropriate form, channel and mode of communication to build rapport, liaise with others and share information Implements strategies to moderate conflict and resolve disputes Negotiates with others to achieve agreeable outcomes in potentially contentious situations |
Get the work done | 1.1, 1.2, 2.1-2.3, 3.3-3.5 | Clearly and thoroughly analyses tasks, then plans strategies and actions to achieve optimal outcomes within given parameters Adopts efficient and effective organisational and time management skills to sequence tasks, meet timelines and arrange meetings Makes decisions and recommendations that lead to best possible outcomes for all stakeholders, including referral to other authorities as necessary Identifies factors that have the potential to impact on the resolution of an issue and develops options to resolve these when they arise Uses a range of digitally based technologies and software packages to complete work tasks |
Sectors
Mercantile agents