Mariam Santrosyan: A successful way to collect overdue debts at Delex law firm

09.04.2024 | 14:00 Home / News / Interviews /
For a decade, the adapt management of the debt collection process tailored to meet contemporary demands has been the business card of Delex law firm. Starting from 2020 the specialized team previously operating within ''Concern-Dialog'' CJSC, has emerged under a new, standalone brand.

In a conversation with, the head of Delex Law Firm Mariam Santrosyan, told about the strategies that make the Firm a leader in the field of overdue debt collection, and talked about the Armenian and international trends in the field.

“We work using a specially developed software in the company.”

The mission of Delex Law Firm is to ensure the collection of clients’ debts in the shortest possible time. Due to this, in the most cases, we do our utmost to offer the debtor individual solutions and a schedule for debt repayment, strictly monitoring that the agreements of settlement are complied with.

At the same time, in case of certain debts, a legal process precedes any negotiation, aimed at enhancing the effectiveness of subsequent negotiations.

Each debt, even when it is standardized, is unique in this respect and requires a unique approach. The client can be confident that we will utilize all legal measures available to pursue the debtor and recover the outstanding debt.

In the company, we work using a specially tailored software that enables effective collection of debts, regardless of the number of debtors of the client and the volume of debts.

Mariam Santrosyan

Drawing on our years of experience and technological advancements, we continually evolve our applied solutions.

After receiving the case from the client, as well as processing and analyzing the case, it is downloaded to the software system, which is followed by the actual debt collection process. The automated software system enables tracking of case progress, conducting analyses, and ensuring compliance with all relevant deadlines, adherence to which is crucial to avoid negative consequences.

Comparative analyses are also carried out in order to identify cases that deviate from the standard procedures and respond promptly to possible deviations. With the aid of software tools, in a short period of time, the employees can prepare and submit orders with the clam for confiscation of money, lawsuits, applications, petitions to submit writs of execution to the Enforcement Service (ES), as well as monitor the execution thereof.

Regardless of the number of cases, we can provide the client with reports on their progress and status at any time. For example, at the moment we have a client who has transferred about 150,000 cases to us over time.

10 years of experience and individual approach to each client

Years of experience have shown that recruiting in a fixed sequence of pre-determined activities, i.e. a linear method, does not ensure the necessary efficiency. Previously, our collection process typically commenced with a phone call, and if the matter progressed to the court stage without success, we ceased further calls to that particular client, assuming the initial call had not yielded results. However, we have now altered our approach. We call the debtor simultaneously and encourage them to pay promptly, avoiding the calculation of damages and interest, additional costs or to find avenues of reconciliation.

Mariam Santrosyan

All processes are aimed at ensuring the fastest and most complete debt collection. Approaches are regularly modified as a result of continuous analysis. Now we are discussing the possibility of using artificial intelligence for analysis. We hope that this will further increase the efficiency of the processes.

Although the actual activity is carried out via the aforementioned automated system, each employee has a clearly separated function. In Delex we have a call center, teams regulating the works with the courts and enforcement services, reconciliation and operative teams. For example, when we submit a claim to the court and not receive a decision within the specified period, the relevant employees contact the court staff to swiftly resolve the issue.

Mariam Santrosyan

The employees also follow the cases when we send the application on submitting the writ of execution to the enforcement service to the court and not receive a decision to initiate enforcement proceedings within the specified time. Similar analytical tools have also been developed for tracking of the dates of the processes related to orders for money forfeiture issued by notaries, arbitral proceedings, and other processes.

The analyses encompass not only the timelines, but also the content of the processes. For example, the efficiency of collection by the Enforcement Services (by individual officers) is thoroughly analyzed and if certain deviations are detected, work is carried out to clarify the issues.

Work in numbers

The effectiveness of collecting overdue debts directly depends on transferring the case to the collector as soon as possible. For example, the successful collection rate for debts that are overdue by 30–60 days is notably high, often reaching or surpassing 60% within a year, depending on the existence of the requisite grounds for debt collection.

At the moment, we have more than 110,000 current cases in Delex. Among our clients are banks, UCOs, organizations providing public services, as well as companies engaged in import, wholesale and retail sales, suppliers.

In the last 4 years, Delex has completed over 22,000 cases with a positive outcome. These are the cases where we have implemented the collection through both negotiations and enforcement services.

Pricing using a success fee method

Different pricing mechanisms operate in the market of legal services and debt collection services.

Delex’s approach in this matter is directly related to our mission to ensure debt collection in a short period of time. We receive a fee exclusively from the amount deposited into the client’s bank account, that is, from the amount actually collected. There are cases when the case in the enforcement services is terminated on the basis of non-discovery of property or funds. In this case, regardless of the work we have done, the client pays only the state fee for applying to the court, and in certain cases, the expenses related to engagement of an expert in the court proceedings. The client is exempted from any other costs related to the process (printing, data processing, salary, postage, etc.). Only after the client actually receives the amount due, do it pay for the services rendered, a certain percentage of the amount actually collected.

Addressing industry challenges

Currently, changes are taking place in the legal process for collection of overdue debts. It has been established that banks, credit organizations, as well as organizations providing public services, on the basis of contracts signed with consumers or clients, shall submit the claim for confiscation of up to 2 million AMD to the notary instead of going to court. To implement this process, the notary shall be paid 10,000 AMD, which is initially paid by the creditor, and if the order is satisfied, it is added to the amount of the debtor’s unpaid obligation.

Mariam Santrosyan

Changes have also taken place in the process of submitting lawsuits to the court, in particular, the platform for electronic lawsuits is being launched. There are still many technical problems in its operation and it is not tailored to more automated data exchange. This further complicates the work of system users. We hope that the technical problems will be eliminated and we consider the existing solutions as a minimal viable product (MVP).

International experience and the importance of changing the mindset

Along with the increase in consumer loans, installment sales and the resulting debts, the role of collection companies in the economy is also increasing.

Artificial intelligence is already being actively used in the recruitment process around the world. It allows you to focus on the most likely collection cases, to develop personalized tactics for individual debts, to find deviations and correlations that are invisible and unnoticeable at first glance, and develop processes aimed at debt collection. Implementing these solutions enhances the efficiency and personalization of even minor debt collection processes.

Delex's success lies in its adherence to international standards for debt collection while effectively adapting them to local contexts.

Yana Shakhramanyan

Photos by Emin Aristakesyan
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