Top 5 Mistakes Businesses Make When Trying to Recover Debts Themselves

Chasing after unpaid debts is one of the toughest parts of running a business. It’s tempting to handle debt recovery in-house to save money — but without the right knowledge and approach, you could end up losing more than you recover. In fact, many businesses unknowingly make costly mistakes when trying to recover debts on their own.

Here are the top five mistakes businesses make when managing debt recovery without professional help:

1. Delaying Action for Too Long

One of the biggest mistakes businesses make is waiting too long before following up on unpaid invoices. Many fear upsetting the customer relationship, but delay often signals to the debtor that repayment isn’t urgent.

In Kenya, the law sets a 6-year limitation period to pursue debts — but practically speaking, the longer you wait, the harder it becomes to recover the money. Documents can get lost, businesses can close, and customers can vanish.

✅ Tip: Follow up on unpaid accounts promptly and consistently.

2. Poor Documentation

When it comes to recovering debts, evidence is everything. Unfortunately, many businesses don’t keep thorough records of transactions, communications, payment agreements, or delivery confirmations.

Without solid proof, it becomes difficult to enforce payment legally — or even persuade a debtor to settle amicably.

✅ Tip: Always keep proper documentation for every transaction, especially contracts, invoices, receipts, and correspondence.

3. Aggressive or Illegal Recovery Tactics

In frustration, some businesses resort to threats, harassment, or public shaming to pressure debtors into paying. Not only is this unprofessional, but it can also lead to lawsuits against your business for defamation or harassment.

Kenyan law protects debtors from unlawful collection practices. Crossing the line can cost you more in legal damages than the debt itself.

✅ Tip: Stay professional. If emotions are running high, it’s better to hand over the case to licensed recovery experts.

4. Not Understanding the Legal Process

Debt recovery isn’t just about calling the debtor and asking for payment. There’s a legal process that must be followed — from issuing a demand letter, to filing a claim in court, to enforcing a judgment.

Many businesses waste time and money pursuing informal “agreements” or making threats that have no legal weight.

✅ Tip: Educate yourself on the basic steps or partner with a professional debt recovery service like Meridian Recoveries.

5. Damaging Customer Relationships

Debt recovery is delicate. If handled poorly, you might recover a payment but lose a customer forever — and even damage your reputation through negative word-of-mouth.

An experienced debt recovery professional knows how to balance firmness with respect, preserving relationships wherever possible while securing what you are owed.

✅ Tip: Treat debt recovery as a business process, not a personal battle.

Final Thoughts

Debt recovery is a serious, legal process — not just a series of angry phone calls or late notices. Trying to handle it yourself without the right approach often leads to more losses than gains.

That’s why many businesses in Kenya turn to Meridian Recoveries for professional, ethical, and effective debt collection services. We understand the law, respect your brand reputation, and work tirelessly to recover what you are owed.