Mar 19 2009
Despite the fact that a majority of debt collectors reported increases in the number of accounts they received for collection in fourth quarter, over a third of collection agencies surveyed reported layoffs in the same period. This according to the 4th Quarter Credit & Debt Collection Confidence Survey, conducted by Kaulkin Ginsberg, the leading strategic advisor to the debt collection / accounts receivable management industry (ARM).

“The sheer volume of accounts currently delinquent or in default would lead many to assume this to be a boon time for debt collection agencies,” said Dimitri Michaud, Kaulkin Ginsberg Consumer Finance Analyst and author of the report. “However, collection agencies reported staff reductions at the end of 2008 – an illustration of the strains the deteriorating economy is currently having on the ARM industry.”

As consumer confidence in the economy declines, debtors become less willing and able to pay their past-due bills. Nearly 67 percent of the agencies surveyed said that current consumer perceptions are having an impact on their ability to recover outstanding receivables, and 41 percent reported weak recovery performance in fourth quarter.

Industry professionals are optimistic for the future however. Michaud added that over a third (35.6 percent) anticipate an increase in their current staffing levels six months from now, which corresponds with a further anticipated increase in business - over 76 percent of debt collection professionals surveyed expect an increased number of accounts, or “placements” in the next six months.

The complete report is available for download on insideARM.com at:
www.insidearm.com/go/credit-and-debt-collection-confidence-survey-4th-quarter-2008