Debt collectors must be courteous and not aggressive under new guidelines for the multi-billion dollar industry.
The first ever code of practice has been launched by the Australian Collectors and Debt Buyers Association, which oversees three quarters of the nation's debt collecting companies, which handle $17 billion of debts at any given time.
Long overdue credit card, utility and phone bills are the most common forms of debt, with some individuals clocking up to $40,000 in debt.
The new rules state debt collectors must act fairly and reasonably, not publicly embarrass customers, and consider the needs facing those in financial hardship.
ACDBA chairman Peter Boehm believes his industry is unfairly tarnished by portrayals of debt collectors as people who "drag their knuckles on the ground and carry a baseball bat".
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"Sixty per cent of collectors are women and most of the communication actually happens via telephone, email and text," he said.
Mr Boehm knows his industry is unpopular, but wants to set a higher standard and give consumers comfort that the ACDBA is there to help.
"It's a phone call nobody wants," he said.
"But the reality is that the consumer has an obligation that they have to meet."
The code comes with the creation of a new committee with powers to discipline debt collectors who fail to comply.
The monitoring committee can order companies to undertake training, issue fines, name and shame and remove a firm's ACDBA membership.
