Should I compromise when attempting to recover debts owed to me?

In some cases, compromising may help you recover at least some of the money rather than none. There is little point in demanding full immediate payment if the debtor is in a position where they cannot pay.

In these situations, talk to the debtor and negotiate a plan for part-payment or rescheduling of debts, ensuring this plan is put into writing. This way, you might recover at least some of what you’re owed in the meantime. Willingness to compromise will also help to maintain a good relationship with the customer, especially if their financial issues are temporary. Be careful what you agree to and, where possible, ask a director for a personal guarantee. If the directors won’t give it then you have strong indication that the debt won’t get paid. In these circumstances acting swiftly can mean the difference between getting paid or eventually becoming an unsecured creditor in a liquidation.