Repaid in full: Industry revenue grows as debt collection outsourcing increases

The Debt Collection industry thrives when the economy is weak, as a weak economy can trigger a rise in business bankruptcies and lead to households defaulting on loans. However, strong economic conditions and tighter lending practices have the opposite effect on the industry. Households and businesses tend to pay down debts during strong economic conditions while tighter lending practices result in better loans with less likelihood of default.The Debt Collection industry has displayed solid growth over the past five years. This result is largely due to falling property prices and weak wage growth. These negative economic factors have contributed to more people and businesses being under financial more.

Industry Statistics & Market Size
Annual Growth 14-19
Forecast Growth 19-24

Industry Threats & Opportunities

  • Government agencies have increasingly outsourced debt collection activities
  • Larger firms have established offshore collection centres to capitalise on cheaper labour costs
  • The Debt Collection industry’s revenue is forecast to continue increasing over the next five years
  • Industry Report - Industry Products Chapter

    The Debt Collection industry includes two main types of debt collection: contingent fee servicing and portfolio acquisition servicing. The main difference between these two services relates to the debt holder. Contingent collection agencies collect debt on behalf of the original creditor for a fee, while debt buyers gain the rights to any money collected on an acquired debt portfolio or purchased debt ledger.Portfolio acquisition servicesPortfolio acquisition services are the largest source of industry revenue. Industry players often purchase these portfolios at a discount. Prices are generally five cents to 10 cents for every dollar of the aggregate principal value of the accounts, with an inverse correlation between the purchase price and the age of the accounts. Onc...purchase to read more.

    Additional Insights for the Debt Collection Industry

    IBISWorld has determined the most important Key Success Factors for the Debt Collection are:

  • Having links with suppliers
  • Access to highly skilled workforce
  • Ability to effectively manage debtors
  • IBISWorld analysts also discuss how external factors such as National unemployment rate and Business bankruptcies in the Debt Collection industry impact industry performance..

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    What's in this report

    What is the Debt Collection Industry?

    Debt collection firms retrieve debt payments from individuals and businesses that have failed to meet the terms and conditions outlined by their loan agreements. A firm can act as an agent on behalf of a creditor, for which the firm receives a fee or percentage of the total amount collected. Alternatively, firms can purchase bad debt from the original creditors at a discount on its face value.

    Industry Products
  • Contingent fee services
  • Portfolio acquisition services
  • Other debt collection services
  • Industry Activities
  • Account collection services
  • Bill collection services
  • Collection agency operations
  • Debt collection services
  • Debt portfolio collection services
  • Debt purchasing
  • Other debt purchase and collection services
  • Repossession services
  • Tax collection on a contract or fee basis
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • National unemployment rate
  • Business bankruptcies
  • Household debt to assets ratio
  • Ratio of credit card debt to discretionary income
  • Ratio of interest payments to disposable income

  • Current Performance
  • Type of debt owned
  • Industry drivers
  • Industry structure
  • Collecting change
  • Chart: Revenue Growth

  • Industry Outlook
  • Demand drivers
  • Industry structure
  • New opportunities
  • Table: Debt Collection Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Debt Collection Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Electricity, Gas, Water and Waste Services
  • Building Societies
  • Credit Unions
  • Public Administration and Safety
  • Telecommunications Services
  • National and Regional Commercial Banks
  • Foreign Banks

  • Key Selling Industries
  • Computer and Electronic Office Equipment Manufacturing
  • Credit Agencies

  • Products & Services
  • Portfolio acquisition services
  • Contingent fee services
  • Other debt collection services
  • Chart: Debt Collection Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Financial sector
  • Other sectors
  • Commercial firms
  • Utility companies
  • Chart: Major Market Segmentation for the Debt Collection Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Chart: Cost Structure Benchmarking – Sector vs Debt Collection

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Debt Collection Industry

  • Industry Globalization
    Credit Corp Group Limited, Collection House Limited, Pioneer Credit Limited,
  • Table: Credit Corp Group Limited - financial performance
  • Table: Collection House Limited - financial performance
  • Table: Pioneer Credit Limited - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Debt Collection Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Debt Collection Industry
  • Industry Revenue (2010-2024)
  • Industry Gross Product (2010-2024)
  • Establishments (2010-2024)
  • Businesses (2010-2024)
  • Employment (2010-2024)
  • Wages (2010-2024)
  • Wages (2010-2024)
  • Purchases (2010-2024)
  • Profit (2010-2024)
  • Depreciation (2010-2024)
  • Rent (2010-2024)
  • Utilities (2010-2024)
  • Other (2010-2024)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Contingent Collection
  • Firms that collect debt on behalf of the original creditor.
  • Ledger
  • An account book with columns for credits and debits.
  • Mercantile Agents
  • Debt collection agents also refer to themselves as mercantile agents.
  • Pdl
  • Purchased debt ledger, which is the purchased debt of another company that the debt collection firm seeks to recoup.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Debt Collection market research report can be used to help you: understand market size and growth potential; major companies; draft business plans and pitch books; and conduct benchmarking and SWOT analysis. Our industry analysis highlights macro industry trends in the overall sector and micro trends faced by companies that do business in the industry. The industry report also provides key industry statistics and 5-year forecasts to anticipate future industry prospects so you can decide with confidence.

    IBISWorld industry market research reports enable you to:
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    This report on Debt Collection:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Debt Collection market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Debt Collection, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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