Dealing with debt collectors

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What is a debt collector?

A debt collector is a person or company that engages in debt collection for payment or reward. This includes:

  • collecting, or requesting payment of, debts owed to another person
  • repossessing goods or property, other than real estate, to use as payment of debts.

There are restrictions on who can operate as a debt collector in Victoria and rules on how debt collectors can act. For more information, view Debt collectors.

If you owe money, creditors may try to collect the debt themselves or engage a debt collector to recover it from you. Creditors may also sell your debt to a debt collector.

Banned debt collection practices

Debt collectors must not engage in banned debt collection practices under Victorian law. This means they cannot engage in unfair conduct, such as:

  • undue harassment - for example, communicating with you in a way that is unreasonable in its frequency, nature or content
  • making threats - this includes exposing or threatening to expose you or a family member to ridicule or acts of intimidation
  • deception - for example, impersonating a government employee or agent, or using a document that looks like an official document but is not
  • misrepresentation - for example, making a false or misleading representation regarding the nature or extent of a debt, or the consequences of not paying a debt.

Example only (outcomes may differ in individual cases):

A woman went into arrears on her credit card when she lost her job and had to care for her ill mother. The bank sold the debt to a debt collection company. The company told the woman that if she left Australia, she would not be able to return while the debt was unpaid.

The company also obtained details and other information about the woman's family. They did this by contacting her friend, pretending the woman had applied for a home loan and seeking information to verify her home loan application.

The company used this information to embarrass the woman and continued to call her, despite her requests that they contact her through her financial counsellor.

The company's actions would be considered harassment.


Debt collectors are also banned from engaging in unfair practices under the Australian Consumer Law. For a full list of banned debt collection practices in Victoria, view Banned debt collection practices.

Complaints about debt collectors

If a debt collector harasses or coerces you into paying a debt, you can lodge a complaint with us. For more information, view General complaint.

Other resources

Victoria Police

If you believe the conduct is more serious or potentially criminal, such as threats of violence, contact Victoria Police.

National Debt Hotline and MoneySmart

The National Debt Helpline and MoneySmart websites have important advice on how to deal with debt collectors. They outline practical steps you can take to dispute a debt and stop unfair debt collection practices.

The National Debt Helpline is a not-for-profit service supported by Consumer Affairs Victoria. For free information on managing bills and debt, your debt options and other tools and tips, visit National Debt Helpline.

The Australian Securities and Investments Commission (ASIC) regulates consumer credit. A number of useful tools and resources to help you manage your finances can be found on MoneySmart.

For specific information for consumers under 25 about managing money, visit MoneySmartRookie.

Consumer Action Law Centre (CALC)

CALC, an advocacy organisation which we fund, also has relevant advice on its website, including what you should say and put in writing to a debt collector, and how to keep records of unfair practices. See the Related information links below.


If you experience humiliation or distress as a result of unfair debt collection practices, you may also apply to a court or VCAT for compensation. For more information, view Debt Collection - seeking compensation - CALC.

If you believe you do not owe the money being sought, you can also apply to VCAT for a declaration to that effect.

Businesses using debt collectors

If you operate a business and engage a debt collector to recover a debt owed to you, remember that you may face criminal penalties if you:

  • aid, abet, counsel or obtain the commission of a criminal offence by a debt collector you hire
  • are involved, or participate, in any breach of the Australian Consumer Law by the debt collector.

For support agencies

View Research and reports about credit and debt.