What must you remember when conducting debt collection in the IT industry?

The IT industry, one of the economy’s fastest-growing sectors, is not immune to problems related to late payments. The complexity of projects, dynamic technological changes, and often imprecise contracts can lead to disputes and payment delays.

In such situations, effective management of the debt collection process, tailored to the specific nature of the IT sector, is crucial.

Specific nature of debt collection in the IT sector

Debt collection in the IT industry may differ in some respects from the standard debt recovery processes that we carry out as a law firm as part of our debt collection in Poland service. IT projects are often based on framework agreements, complex schedules, and phased implementation of solutions. There are usually situations where the client questions the quality of the service provided or delays payment due to dissatisfaction with the results of the cooperation.

In such cases, it is essential to document the course of the project thoroughly.

• The scope of work,
• Deadlines,
• Communication with the client,
• Acceptance of individual stages.

This makes it possible to effectively pursue claims, both through amicable settlement and in court. However, the key in this regard is for the creditor to have a complete set of documentation, both from before the contract was signed and from each stage of its implementation.

Amicable dispute resolution methods

Before a case goes to court, it is worth attempting to resolve the dispute amicably. In the IT industry, where business relationships are often based on long-term cooperation, maintaining good relations with the customer is extremely important. It is worth noting that effective amicable debt collection is essential not only from the point of view of business relations but also from the point of view of efficiency.

In many cases, this method of debt collection is faster. By entrusting amicable debt collection to professionals, you, as the creditor, may obtain funds faster than by going through the entire court and bailiff debt collection process. 

The most common methods of amicable debt collection include:

• payment reminders,
• e-mail and telephone reminders,
• negotiation of repayment terms,
• warnings about the possibility of entering the debtor in the debt register.

These activities must be carried out by the law and good practice, avoiding pressure that could violate the debtor’s rights. In addition, the creditor must collect the debtor’s data at the stage of signing the agreement, which will enable effective debt collection in this mode. This data includes, in particular:

• Tax identification number,
• Telephone number of decision-makers,
• E-mail address,
• Current mailing address.

Court and enforcement proceedings

If amicable debt recovery methods fail, referring the case to court may be necessary. In the IT industry, where disputes often concern technical issues, it is essential to prepare appropriate documentation and, if required, appoint a court expert and gather private opinions.

Debt collection in Poland, i.e. the recovery of debts in Poland through court proceedings, primarily involves filing a lawsuit with the competent court and obtaining an enforcement title. This could be a judgment or payment order, allowing the creditor to begin bailiff enforcement. This involves the compulsory enforcement of the debt, e.g. through the seizure of a bank account, the seizure of receivables or the auction of assets.

Once a final judgment has been obtained, enforcement proceedings may be initiated to recover the debt. It is worth remembering that the effectiveness of enforcement depends on many factors, including the debtor’s current financial situation and assets.

The role of a professional representative

In the debt collection process, especially in such a specialised industry as IT, the support of a professional representative, such as a lawyer or legal advisor, is often indispensable.

A lawyer specialising in providing services to technology companies will help prepare the relevant documents, conduct negotiations, and represent the creditor in court.

Thanks to their knowledge of the specifics of the IT industry, the representative can effectively advise on the best solutions, minimising risk and increasing the chances of recovering the debt. In addition, based on specific debt collection processes, they can suggest improvements to processes that may reduce payment bottlenecks in the future.

An example of such an improvement would be charging the debtor a flat fee of 40/70 or even 100 euros as compensation for debt recovery costs by the Act on Counteracting Excessive Delays in Commercial Transactions.

Can debt collection in IT be improved?

The best way to avoid debt collection problems is to secure your interests at the pre-contractual negotiation stage properly. In the IT sector, it’s especially crucial to:

• Precisely define the scope of work,
• Set a schedule for completion,
• Specify payment terms and deadlines,
• Outline the process for approving each project stage.

A well-structured contract that considers the project’s specific nature and potential risks can significantly facilitate the pursuit of claims in the event of a customer’s failure to meet their obligations.

In addition, the creditor may also take other steps before signing the contract that may limit problems at later stages. One of these is to thoroughly verify the contractor before signing the contract. For this purpose, you can use, for example, data from the National Debt Register (KRZ), information on arrears disclosed in the National Court Register (KRS), or from credit bureaus.

Summary

Despite its modernity, the IT industry struggles with payment bottlenecks typical of many sectors of the economy. In many cases, however, the solution in this industry requires a slightly different approach. IT projects are specific, and disputes surrounding them are often complex and challenging to resolve unequivocally. That is why it is essential to have proper documentation, cooperation with an experienced law firm, and a well-thought-out contract, drawn up when establishing a business relationship.

Debt collection in the IT sector does not have to mean conflict. A good strategy and a professional approach can become a tool for effectively enforcing your rights without burning bridges with your contractors. The most important thing, however, is not to delay your response – the sooner action is taken, the greater the chance of a successful outcome.