We introduced you to settlements and left you with a question – Why is really settlement resorted to?


Every business takes years to build, it spreads in various locations, geographies and regions. Key to any business are its customers, who over a period of time become quite loyal to the business, in the literal sense of the word. Most of your clients grew that way.

To control any business and drive compliance, steady and timely deliverables, cashflow etc., some rules are defined, which may include numerous factors, like rewards for good and regular customers, penalties for defaulters.

Now, everything does not happen the way it should. There can be misses, errors, or a one-off situation. There can be various interpretations of business terms / clauses, leading to disagreements and disputes..

Any business would like to retain its good and loyal customer base for a long time, and does take steps to grow it as well.

And this is where settlements come into play. Normally, any one-off situation may need to be discussed and settled across the table to ensure that you client retains the loyalty of its customer and ensure continued business and patronage.

Easier said than done, there are fundamentally no pre-defined rules for this. Each business over the years, builds best practices and norms for repeated situations that are observed. There is a constant endeavor to standardize things to the extent possible.

To conclude today, settlements are crucial to any business. Normally only standardized components are outsourced, whereas slightly decision making settlements are moved to an internal back office. In most of the cases, especially unique ones, these are retained by your client. What really is normally outsourced is a helpdesk to receive a dispute, do research and collate evidences, do a standard resolution or settlement, upto the limit of authority provided and then move this to the settlement team as may be mandated by the criticalities of the case.


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