What is Receivable Management?
Receivable management (also called accounts receivable management or ARM) is the systematic process of tracking, collecting, and recovering outstanding payments owed to a business. For financial institutions such as NBFCs, banks, fintech lenders, and microfinance institutions, effective receivable management is critical to maintaining healthy cash flow, reducing NPA (Non-Performing Assets), and ensuring regulatory compliance.
A modern receivable management system like CarmaOne goes beyond traditional spreadsheet-based tracking. It combines AI-powered digital collections — including multilingual automated calling, SMS, WhatsApp, and email outreach — with nationwide field operations and legal recovery support covering S.138 (Negotiable Instruments Act), SARFESI, civil suits, and arbitration.
Key Components of AI-Powered Receivable Management
- Digital Collections Automation — AI agents engage borrowers across multiple channels (SMS, WhatsApp, email, voice calls) in their preferred language, reducing manual effort and improving contact rates.
- Field Recovery Operations — KYC-verified, background-checked field agents with real-time GPS tracking ensure compliant and professional on-ground recovery across India.
- Legal Recovery Management — Automated generation and dispatch of legal notices, with escalation pathways for S.138, SARFESI, civil litigation, and arbitration proceedings.
- Business-Controlled Intensity — Lenders define collection intensity per borrower, preserving relationships with good customers while applying firm recovery for delinquent accounts.
- Compliance & Audit Trails — Every call, visit, and communication is recorded, transcribed, and stored for complete regulatory compliance and audit readiness.
Who Needs Receivable Management Software?
Receivable management solutions are essential for any business that extends credit — including NBFCs, commercial banks, fintech lending platforms, microfinance institutions (MFIs), B2B trade credit businesses, insurance companies, and collection agencies. Whether managing small-ticket personal loans or large corporate receivables, a purpose-built platform ensures faster recovery, lower costs, and better borrower relationships.
NPA Recovery and Loan Default Management
Under RBI guidelines, a loan account is classified as a Non-Performing Asset (NPA) after 90 days of EMI default. Once classified as NPA, the borrower's credit score drops by 50-100 points, and the record remains on their credit report for 7 years. For lenders, rising NPAs directly impact profitability and capital adequacy ratios. As of September 2024, gross NPAs of Indian banks stood at a 12-year low of 2.6%, but RBI stress tests indicate this could rise to 3% by March 2026 — making proactive NPA recovery and delinquency management essential.
CarmaOne helps lenders intervene early with automated payment reminders and dunning workflows triggered at the first sign of delinquency — well before the 90-day NPA classification window. The platform supports escalation through digital collections, field recovery, and legal proceedings including One Time Settlement (OTS), Lok Adalat referrals, and formal legal action.
Legal Recovery: SARFAESI Act, DRT, and Section 138
India's legal framework for debt recovery includes several powerful mechanisms. The SARFAESI Act (2002) allows banks and NBFCs to recover secured loans without court intervention — the borrower receives a 60-day notice, after which the lender can take possession of the secured asset. This applies when the outstanding amount exceeds ₹1 lakh and the loan has been classified as NPA. The Debt Recovery Tribunal (DRT) handles claims above ₹20 lakh through a specialized adjudicatory process. Section 138 of the Negotiable Instruments Act addresses dishonoured cheques and EMI bounces, enabling criminal proceedings against defaulters.
CarmaOne automates the legal notice generation and dispatch process across all these channels, maintains complete documentation for DRT filings and SARFAESI proceedings, and coordinates with 20+ collection partners and 7+ legal agencies across India — ensuring lenders can pursue legal recovery efficiently while maintaining full audit trails.
Digital vs. Field Collections: An Omnichannel Approach
Modern debt collection requires an omnichannel strategy that combines digital and physical touchpoints. Digital collections — including AI calling, SMS, WhatsApp, and email campaigns — handle high-volume outreach efficiently and cost-effectively. Field collections are deployed for accounts requiring personal engagement, particularly in tier-2 and tier-3 cities where digital penetration may be lower. According to McKinsey, the use of generative AI and automation in collections can increase productivity by up to 30%, while predictive delinquency analytics help identify high-risk accounts before they default.
Why Choose CarmaOne for Receivable Management in India?
CarmaOne is purpose-built for the Indian market with pan-India coverage across 22+ states and 14,000+ pin codes, multilingual AI agents speaking Hindi, Tamil, English, and more, and deep integration with India's legal frameworks including the SARFAESI Act, Section 138 of the Negotiable Instruments Act, Debt Recovery Tribunal (DRT) proceedings, and the Arbitration and Conciliation Act. With ₹480 Cr+ AUM managed across 25+ enterprise clients including NBFCs, banks, and fintech lenders, CarmaOne delivers proven results — ₹5.36 crore recovered in 4 months, ₹2.35 crore settled through negotiation, and ₹2.45 crore recovered in 2 months.
The India debt collection software market is estimated at USD 175 million in 2022 and expected to reach USD 273 million by 2027. As lending volumes grow and retail delinquencies rise, lenders need AI-powered, RBI-compliant collection platforms that combine digital automation, field operations, and legal recovery into one unified system. CarmaOne delivers exactly that — a complete receivable management platform that reduces DSO, improves recovery rates, and ensures compliance at every touchpoint.