Myths and Misconceptions About Debt Collection in Singapore

Debt collection is a necessary part of doing business, but it’s also one of the most misunderstood. In Singapore, many individuals and companies hold outdated or incorrect beliefs about how debt collection works, which can lead to fear, inaction, or even costly mistakes.

Myth 1: Debt Collection Is Illegal or Shady

Reality:
Debt collection in Singapore is completely legal when conducted within the framework of local laws. While some people associate debt collectors with harassment or intimidation due to stories from overseas or media portrayals, reputable debt collection companies in Singapore operate professionally and ethically.

In fact, many agencies, like Swift Debt Recovery, follow strict guidelines that ensure privacy, fairness, and lawful conduct during the collection process.

Myth 2: Only Big Companies Can Use Debt Collection Services

Reality:
Debt collection is not just for large corporations. Small businesses, freelancers, and even individuals in Singapore can engage debt collectors to recover unpaid debts. Whether you’re owed $500 or $50,000, professional debt recovery services can help you reclaim what’s rightfully yours.

It’s about protecting your cash flow—no matter the size of your business.

Myth 3: Hiring a Debt Collector Will Damage Customer Relationships

Reality:
While it’s natural to worry about straining relationships, ignoring unpaid debts is often worse. Professional debt collectors are trained to approach debtors diplomatically. Their goal is to negotiate a resolution while maintaining respect and minimizing conflict.

By outsourcing debt recovery to a third party like Swift Debt Recovery, you avoid personal confrontations and preserve your business reputation.

Myth 4: Debt Collection Is the Same as Legal Action

Reality:
Many confuse debt collection with suing someone, but these are two separate processes. Debt collection is a pre-legal effort to recover money owed without going to court. Legal action is typically a last resort when other recovery attempts have failed.

A skilled debt collector in Singapore will exhaust all non-legal methods first, saving you time, money, and stress.

Myth 5: Debt Collectors Can Harass or Intimidate Debtors

Reality:
In Singapore, harassment is strictly prohibited under the law, including the Protection from Harassment Act (POHA). Reputable debt collection firms avoid threats, intimidation, or any behavior that may be considered coercive.

If you hire a licensed and ethical agency like Swift Debt Recovery, you can rest assured that all interactions are professional, recorded, and compliant with local laws.

Myth 6: It’s Too Late to Collect an Old Debt

Reality:
While it’s best to act early, not all hope is lost if a debt has aged. In Singapore, the limitation period for most debts is six years from the date of default. As long as your debt falls within this window, you may still be able to recover it—with proper documentation and the help of a seasoned debt collector.

Myth 7: You’ll Lose a Lot of Money to Collection Fees

Reality:
Yes, debt collection services charge fees, but they are typically performance-based—meaning you pay only if the debt is recovered. Moreover, recovering part of the debt is often far better than writing off the entire amount.

A trustworthy agency will be upfront about costs and help you determine if it’s worth pursuing recovery.

Myth 8: It’s Better to Wait and See If the Debtor Pays

Reality:
The longer you wait, the harder it is to recover a debt. Debtors may move, shut down businesses, or lose track of their obligations. Delays also signal to debtors that you’re not serious about recovery.

Acting quickly—ideally within 30–90 days of non-payment—shows you’re proactive and often results in higher recovery rates.

Don’t Let Misconceptions Hold You Back
If fear or misinformation has kept you from pursuing what you’re owed, it’s time to think again. With the right guidance and a professional team, debt collection can be effective, legal, and respectful.

At Swift Debt Recovery, we’re on a mission to change the perception of debt collection in Singapore. We provide ethical, compliant, and results-driven debt recovery services for businesses and individuals alike.

Contact us today for a free consultation!