A call from a debt collector can strike fear into the heart of a consumer — but what makes collectors themselves shake in their boots? These days, the answer is clear: Regulators!
The latest proof of this can be found in a survey of UK collectors conducted by FICO and Market Force, to be released next month. The early findings show that two-thirds of respondents think new regulations from the Financial Conduct Authority — which takes over regulation of UK consumer credit in April 2014 — will drive up collection costs and hurt collection rates. Nearly as many (64 percent) said that the increasing burden of regulation will negatively affect collection rates.
Oddly enough, the group of collectors least worried (a relatively small 51 percent) are those who work for banks. Perhaps they are just more used to the crushing weight of regulation than their peers at debt collection agencies or other industries.
Whether it’s the FCA in the UK or the CFPB in the USA, there’s a new wave of “consumer-friendly” rules coming. How are collectors adapting? Watch this space for news about our survey next month.