Find the best debt collection agency in Abuja
Need help retrieving a claim in Abuja? Submit your claim now and get 3 free quotes from local debt collectors!
.svg)
Getting started is as easy as 1,2,3...
.svg)
Our local partners
Explore debt collection experts in Abuja for any budget
How to collect an unpaid invoice from a debtor in Abuja?
Do you need assistance in recovering an amount owed to you in Abuja, Nigeria? This guide will provide you with every detail you need to collect debts in the Abuja area. Should you need the services of a debt collection agency or solicitor, please submit our form and receive three free price estimates within two days.
Overview of the debt collection process in Abuja
We personalize the debt collection process in Abuja to your specific needs by ensuring that recovery rates are as high as possible. How we do this involves conducting a thorough analysis of the situation prior to beginning the collection case. We take into account the size of the claim, the type of debtor, and other relevant factors before proceeding.
The image below explains our standard framework for collecting debt in Abuja:
Step 1: Find a local collection agency or attorney
You can just submit your particulars to Debitura and you will get 3 quotations from ABJ-based debt collection companies that are ready to lend a hand.
Step 2: Pre-legal collections
So, to start your collection process in Abuja, we'll send an array of notifications to your debtor, including emails, texts, and letters. If they respond affirmatively, you don't have to pay a penny—the fee is only due when we successfully recover the debt you are owed.
Step 3: Evaluation:
If you have not been given compensation by the debtor after initiating the pre-legal measures, it might be prudent to weigh the options of your claim's magnitude, the potentiality of payment, and the legal framework in Abuja in order to decide what the best course of action would be. There are three normal steps available to those in Nigeria:
Step A: Surveillance:
If your claim does not exceed 5000$, it generally does not make sense to initiate further legal proceedings. Therefore, we advise you to adopt a "debt surveillance" strategy, meaning we will keep contacting your debtor in search of a mutually agreeable agreement. This debt surveillance phase is a pre-legal step. We will inform you of any changes in circumstance that necessitate a change in action.
Step B: Legal collections:
If it is a financially significant claim, we advise beginning the legal course of action following the pre-legal case. Generally, the cut-off amount is 5,000$, however that depends upon the debtor's capacity to pay and other variables. How the procedure progresses and the costs involved can differ depending on the circumstances of your claim. Normally, minor claims can be taken care of through a simpler legal process. Normally, the time frame for the legal collection process can range from 12-18 months and often involves a fixed fee for covering legal costs. To secure quality and budget-friendly legal help, it is recommended to compare prices from multiple debt collection attorneys in Abuja.
Step C: Debt enforcement:
If you have an acknowledgement from the debtor or a court order in place, you can use the services of a bailiff court to enforce your claim. This is normally a 12-18-month process in Abuja, and generally you will have to pay a fixed amount to the court, as well as legal fees to your legal debt collection advisor. The total fee will depend on the size of your claim. To get an accurate estimate, just upload your claim to Debitura.
Pre-legal debt collection in Abuja
Pre-legal debt collection refers to the collection efforts prior to legal action, also known as amicable collection. We suggest beginning with pre-legal collection unless the debtor has contested the debt. There are plenty of advantages in taking this route, including being able to maintain a good relationship with the debtor which is important for potential future business. Pre-legal steps are also much faster than legal collections and can be undertaken without financial risk, usually only requiring a success fee if the debt is successfully recovered.
First-party collections refer to the process of collecting debt yourself. It involves all steps being handled directly by you or your internal staff. On the other hand, third-party collections involve you appointing a professional debt collection agency to take care of the process for you. This agency has specialised resources and knowledge to ensure timely recovery of the debt amount. Ultimately, the decision of whether to use first-party or third-party collections should be based on the amount of effort and time you can commit to the process.
Considering offering a payment plan as a possible solution
Debt collection in Abuja is a process that starts with an initial assessment of the debt and the debtor. Collection agencies typically start communication by attempting to reach an agreeable solution with the debtor. This may involve sending multiple reminders and follow-up communication across multiple channels. Communication should remain professional and respectful, and creditors must be aware of their and the debtor's rights to operate within the law. Documentation of all communication and actions taken is essential. The objective is to reach full payment or negotiate a satisfactory payment plan or settlement. Best practices for amicable debt collection include knowing the debt collection laws, being professional and respectful, keeping accurate records, staying within the law, and offering a payment plan.
Interest fees can be charged on unpaid invoices and late payment fees on top of the principal amount can be added. Different interest rates apply depending on the age and size of the invoice.
We are fully compliant with the civil laws regulating debt collection in Nigeria, to ensure the process is handled in a fair and effective manner. Throughout, we remain cognizant of the fact that relationship between debtors and creditors needs to be maintained.
Legal debt collection in Abuja
No one likes the idea of going through legal debt collection for unpaid claims, but it can be a necessary step to take. If your claim is for more than 5,000 USD and the debtor has not responded positively to amicable means, it is definitely time to consider using a legal approach. Legal debt collection can be a lengthy and expensive process and as such, it should only be used if the amount owed is worth that effort. However, it is often the only way to get your money, so it is important that it is an option to consider. Even if the likelihood of the debtor paying is low, the right strategy may still help to reclaim part of the claim. It is important to understand that the legal system is complex and that there are a range of tools you can use to get the best resolution. Taking expert advice can certainly help you make the right decision.
Debitura makes finding a qualified and experienced debt collection attorney in Abuja easier. We provide you with access to three free quotes from local, reputable debt collection agencies and attorneys. This allows you to compare prices and understand the exact costs and steps involved in pursuing legal collection of debts. With Debitura, you can find the perfect debt collection attorney for your needs and save time and money in the process.
In the legal phase of debt collection, our Nigerian partner will attempt to negotiate a repayment plan with the debtor. If this is unsuccessful, they will move forward with various legal proceedings, such as litigation, debt enforcement, mediation or bankruptcy, depending upon the size of the claim. All of these activities are regulated by the civil laws of Nigeria and can take between 12-18 months before a resolution is achieved.
Cost of debt collection in Abuja
Average success fee for pre-legal debt collection in Abuja
The cost of debt collection in Abuja can vary depending on the size of your claim and the collection phase. Generally, for pre-legal debt collection, your fees are subject to successful recovery of the debt, with the amount determined by the size of your claim. On average, successful amicable collections result in the following fees:
Hourly rate for legal-debt collection services in Abuja
When it comes to legal debt collection in Abuja, cost is determined by two factors: court costs and an hourly fee for professional legal services received. The amount a client pays for legal services depends on the complexity of the claim and the total number of hours devoted to it. The average hourly rate of debt collection attorneys in Abuja can be found in the table above.
Abuja city risk profile
We have looked at Abuja's critical financial data and extrapolated a risk assessment. You can use this analysis to classify your payment terms and manage your risk when doing business with customers in Abuja.
Our analysis has shown that the risk of doing business in Abuja is medium-high.
Based on this medium-high score, we recommend always charging upfront payment or using credit insurance when trading with customers in Abuja, as it may be very difficult to get paid.
The medium-high risk score is based on the following factors:
.png)
.png)
.png)
.png)
Economic risk in Abuja
Nigeria is an African country with a large economy, ranking #31 out of 183 countries based on the size of its Gross Domestic Product (GDP). According to latest figures, Nigeria's economy is valued at 440.78 billion USD and is growing at 3.65% per year. The GDP per capita of 2085 USD puts Nigeria at #135 out of 183 countries and indicates that the citizens have low purchasing power. Inflation rate in Nigeria is 17%, and businesses have an interest rate of 11.48%. Although the economic risk in Nigeria is medium-high, its economic growth is considered excellent and it is low on the African continent.
Business risk in Abuja
The city of Abuja in Nigeria has an overall business risk rating of 6 out of 6, according to a recent analysis. Economic freedom and rights have been determined as major influencing factors for the rating, with low scores for key indicators such as property rights index (37 out of 100) and freedom from corruption index (24 out of 100). Further, the business freedom index is at a decent score of 60 out of 100, yet the investment freedom index is only 45 out of 100 and the financial freedom index is 40 out of 100. As a result, Nigeria's overall economic freedom index is 59 out of 100. Businesses, both small and large, should be aware of these risk factors, particularly when operating in Abuja.
Political risk in Abuja
Abuja, the capital of Nigeria, is exposed to significant political risk. The rule of law index located at -0.86 is indicative of difficulties companies may face when attempting to enforce contracts in the city. As is suggested in the Corruption Perceptions Index, with a score of 24 out of 100, a steady level of illicit behaviour is also prevalent. The government effectiveness index of -1, and political stability index of -1.78 further bolster this conclusion. The large shadow economy, amounting to 52.49% of the country’s GDP, warns of ongoing instability, meaning that trading in Abuja involves much more risk than in more developed cities. As such, we recommend avoiding credit and charging upfront payment when trading in Abuja.
Commercial risk in Abuja
Abuja, the capital of Nigeria, faces a high commercial risk according to our model. This score is higher than the average for Africa, and is determined by a country's international trade relationships. Nigeria has a foreign exchange reserve of bn. USD, indicating good relations with trading partners. To protect against commercial risk, companies and investors should conduct careful research before entering into any business deals in Abuja, as the potential risk involved is higher than average.
Financial risk in Abuja
The Financial risk for Abuja, the capital of Nigeria, sits at a medium risk of 3/4. This is not unexpected for countries in Africa. Credit information sharing, on a scale from 0 (low) to 8 (high) is 8, indicating availability and quality of credit information is high. Interest rates and legal rights for creditors and borrowers also impact this risk, with interest rates in the private sector at 11.48% and legal rights for creditors at 9 out of 12 (strong). All of these add up to the medium financial risk present within Abuja.
Looking for more detailed information? Then have a look at our country guide.
Read full country guide
.svg)