Collection Agency

Business, Legal & Accounting Glossary

Definition: Collection Agency


Quick Summary of Collection Agency


A company hired by a creditor to collect a debt that it is owed. Creditors typically hire a collection agency only after they have made efforts to collect the debt themselves, typically through letters (called “dunning” letters) and telephone calls. In the US, Collection agencies are regulated by the federal Fair Debt Collection Practices Act. Unfortunately, too many collectors ignore this law.




Full Definition of Collection Agency


collection agency is an organization that specializes in the collection of overdue debts. They are best known for hassling people who owe money by telephone or in-person with a knock on the door.

Creditors who feel that your bills are overdue and have failed to talk you into payment can decide to turn the bill over to a collection agency. The collection agency usually keeps a portion of the funds collected. They can also attempt to garnish wages.


Cite Term


To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
https://payrollheaven.com/define/collection-agency/
Modern Language Association (MLA):
Collection Agency. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. September 24, 2021 https://payrollheaven.com/define/collection-agency/.
Chicago Manual of Style (CMS):
Collection Agency. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. https://payrollheaven.com/define/collection-agency/ (accessed: September 24, 2021).
American Psychological Association (APA):
Collection Agency. PayrollHeaven.com. Retrieved September 24, 2021, from PayrollHeaven.com website: https://payrollheaven.com/define/collection-agency/

Definition Sources


Definitions for Collection Agency are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 4th August, 2021 | 3 Views.