Debt Collection Industry Trends for 2023

Change is always a critical part of ensuring that a company thrives and can address new concerns; this situation is no different regarding collections. If you haven’t hired a debt collection in recent years, there’s a good chance you’ll be surprised at how different the industry looks today. Here are a few ways that debt collection is changing in 2023.

New Technological Considerations

At the end of 2021, new rules in the Fair Debt Collection Practices Act came into effect regarding how debt collectors can contact debtors. While no other changes had been made to this act for many years, the main necessity for the update concerned the use of new communications technology.

While debt collectors are using technology today to keep better records of each case they seek to resolve, they have also employed technology to reach people who might otherwise seem elusive. It should come as no surprise that digital technologies like text messaging and social media would be helpful for finding debtors in this way.

That said, without any rules to explicitly address how debt collectors are allowed to use these means of communication, debtors were in jeopardy of becoming the victims of unethical practices. Once the new rules came into effect, all of that changed. Clear limitations are mandated regarding how often debt collectors are allowed to contact delinquents through new communication technology.

Debt Collection Industry Trends

Ethical Debt Collection Practices

While the need for new regulations concerning digital communications technologies might seem unsettling at first glance, many debt collectors welcome these changes. The reason why collection agencies are amenable to new laws regarding proper conduct toward debtors reflects a larger change in the industry as a whole toward ethical collection strategies and mandates.

Today, many agencies, like Summit Account Resolution in Minnesota, are at the cutting edge of a positive change in collection practices. While many debt collectors are eager to change an outdated reputation in the industry and hold personal standards regarding respect and dignity towards all people, this is not the only reason for the change.

More than any other reason, the shift towards ethical collection practices reflects a growing understanding among debt collection specialists that unethical practices are not only immoral but ineffective.

After all, one of the most critical steps in resolving debt disputes is the ability to open up a channel of respectful communication. Unethical practices like harassment and intimidation are antithetical to this stage of progress in a case.

Customer Experience

Along with a move toward ethical practices and newer communications technology comes an emphasis on customer experience, even when it comes to the delinquent. Debt collection agencies are eager to resolve debt disputes as amicably as possible. This often involves working out payment plans that are well-suited to all parties involved. In this way, repayment may take longer but is often more likely to be successful.

If you’re interested in learning more about how the debt collection industry is changing for the better in 2023, contact a local debt collection agency today.

Related: What Are Personal Installment Loans and How Do They Work?


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