Every government, irrespective of whether they have an internal collection department, should consider whether using an outside collection agency (OCA) as part of the overall collection strategy is beneficial to the organization. Use of collection agencies varies widely within government and the decision to outsource some or all collections can be complicated.
Government use of collection agencies comes in all shapes and sizes. Some governments outsource everything, some outsource nothing, and there’s every solution in between. According to ACA International, the “majority of federal agencies, 43 states, and thousands of cities and counties nationwide” are using collection agencies in some capacity.
Making a determination on whether to outsource can be a political hot potato, especially when economic strain is affecting taxpayers. This section of our site provides some information about when and how to choose an agency and GRCA’s standards for selecting a quality, reputable agency. Our members-only section contains sample RFPs and contracts used by other governments when outsourcing their collections.