Guide for firms
Debt mediation workflow for firms
A debt mediation practice usually moves through the same stages: bring in the client, understand what they can afford, prepare proposals, record creditor responses, manage the accepted arrangement, and close each account properly.
The hard part is not knowing those stages. It is keeping the information connected as a client moves through them. A phone note should not be the only record of a counter-offer. A payment allocation should not depend on a spreadsheet that only one person understands.
This guide sets out a workable firm-side process and the records each stage should leave behind.
1. Start with a complete intake
The first record should give the team enough context to work without repeatedly asking the client for the same information.
Capture:
- contact and identity details;
- income and pay frequency;
- regular household expenses;
- each creditor and account balance;
- current instalments and arrears;
- supporting documents; and
- the client's consent and mandate records.
Keep the intake structured. If income is captured in one field, expenses in another, and creditor details in an email thread, the next step will still be manual. Our client onboarding checklist sets out what to collect and in what order.
2. Assess affordability before proposing anything
Use the client's income and essential expenses to work out what may be available for creditors. Keep the calculation visible in the case and record when it was prepared. The affordability assessment guide covers the method in detail.
An affordability figure is not a promise that creditors will accept a proposal. It is the starting point for a realistic conversation. If the numbers leave no workable amount, the mediator should say so rather than send a proposal that cannot be maintained.
The assessment should be easy to update when the client's circumstances change. Keep the previous version or a clear history of changes so the team can explain how the proposal was reached.
3. Prepare a proposal for each creditor
A single client may need several proposals. Each one should show the creditor, account, amount offered, proposed instalment, and any other terms being requested.
Track the proposal's status:
- draft;
- sent;
- awaiting response;
- accepted;
- rejected; or
- counter-offer received.
Keep the response against the relevant account, not only in a shared inbox. If a creditor changes the terms, record the new version and the date it was agreed. See creditor proposal tracking for a fuller approach.
4. Record the accepted arrangement
Once terms are accepted, record the arrangement in a way the whole team can read. Include the agreed instalment, start date, payment instructions, fee treatment, and any conditions or review dates.
The record should make it clear which proposal is current. Otherwise, staff can work from an older email or send a payment based on terms that have already changed.
5. Record each payment and allocation
DebtDesk does not receive or move mediation-client money. The mediation practice handles those payments offline.
The system can still be used to record the payment received, apply the agreed allocation rules, and produce a distribution record for the practice's own reconciliation and client communication.
Check each record for:
- payment date and amount;
- agreed fee and VAT treatment, where applicable;
- amount allocated to each creditor;
- rejected or short payments; and
- updated account balances.
The customer remains responsible for checking the record before acting on it or sending it to a client or creditor. To test a split, try the payment distribution calculator.
6. Close accounts properly
When an account reaches zero, keep the final balance and the creditor's confirmation together. Record the date the account was paid up and store the paid-up letter or other confirmation.
Closing a case should not mean deleting its history. A complete record helps the practice answer later questions without reconstructing the file from old emails and spreadsheets.
Where the workflow usually breaks
Firms tend to feel the strain in the hand-offs:
- intake information is retyped into a spreadsheet;
- the affordability figure is not updated when circumstances change;
- a proposal response stays in one person's inbox;
- staff use different versions of the agreed terms;
- payment allocations are recalculated manually; or
- documents are copied from an old template with the wrong client details.
These are process problems, not just filing problems. A useful system keeps the next action, current terms, calculations, and documents connected to the same case.
What a firm-wide workflow should give you
At any point, a team member should be able to answer:
- What can this client afford?
- Which creditors have received a proposal?
- What did each creditor agree to?
- What payment record is current?
- Which accounts are settled, and what confirmation is stored?
If answering those questions means searching three places, the workflow is still fragmented. As a practice grows, see scaling a debt mediation practice beyond spreadsheets.
How DebtDesk fits
DebtDesk brings intake, affordability, creditor proposals, negotiation records, payment-allocation records, and mediation documents into one case-management system for South African mediation firms.
It is back-office software. It does not conduct debt review, provide legal advice, or handle the client's money.
Common questions
What is the standard workflow for a debt mediation firm?
Most firms move from client intake to affordability assessment, creditor proposals, negotiation tracking, accepted terms, payment records, and account closure. The exact process depends on the firm's model and agreements with clients and creditors.
Should affordability be kept in a spreadsheet?
A spreadsheet can work for a small number of files, but it becomes harder to control as the practice grows. A case-management system keeps the calculation with the client record and makes changes easier to track.
Does DebtDesk handle client payments?
No. DebtDesk does not receive, hold, or transfer mediation-client money. It records payment information and produces allocation records; the practice handles payments offline.
What should happen when a creditor rejects a proposal?
Record the rejection, keep the creditor's response against the account, and decide whether to send a counter-proposal, request more information, or discuss another option with the client.
For mediation firms
See the workflow on a real file
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