How much does commercial debt recovery cost in the UK?
Most agencies will not publish their rates. Here is what the market charges, what the statutory sums do to the real cost, and how to compare quotes properly.
What the market charges
Commercial recovery in the UK is almost always commission on what is collected, with no fee if nothing is. Rates vary with the age and size of the debt: roughly 5 to 15% for fresh debt under 90 days, 15 to 25% for debt over six months, and more for very old or very small balances. Some firms charge a fixed fee per letter instead, which is cheap if it works and expensive if it does not. Solicitors typically charge fixed fees for the letter before action and hourly for anything after.
What the statutory sums do to the cost
This is the part most comparisons miss. Under the Late Payment of Commercial Debts (Interest) Act 1998, every overdue invoice carries interest at base rate plus 8% and fixed compensation of £40 to £100. A firm that claims those sums alongside the principal collects money you would never have invoiced, and it often covers most or all of the fee.
Questions to ask before you instruct
- Are your rates published, and do they change with the age of the debt?
- Do you claim statutory interest and compensation on every invoice, and do they pass to me in full?
- Does anything formal go out without my written approval?
- Do you check Companies House before writing to my customer?
- Do you hold client money, and if so, in what kind of account?
- What happens if my customer pays me directly?
Clearline's rates
| Debt age at instruction | Standard | With credit control subscription |
|---|---|---|
| Under 90 days | 10% | 8% |
| 90 days to 12 months | 15% | 12% |
| Over 12 months | 25% | 20% |
No recovery, no fee. Statutory sums to you in full. Nothing formal without your approval. Published on the fees page, because the alternative is asking you to trust a quote.