Collectors report more business, but tougher time getting paid

NZ Blacklist Debt Collection Solutions.

Reports from the U.S show debt collection has rise in business. Press Democrat report;

Debt collection is a growth industry these days, but that doesn't mean it's a terribly profitable one.

As more people fall behind on their credit card bills and car payments, collection agencies are busier than ever, churning out warning letters, calling people's homes or businesses and even dragging them into court.

But collecting on those mounting debts is tougher than ever. High unemployment and plunging home equity have left debtors with fewer resources -- and some say less inclination -- to repay debts and repair their credit ratings.

"I work four times as hard to collect the same amount of money as I did two years ago," said Robert Tavelli, head of the Santa Rosa-based collection firm NCCS Inc. "We're seeing probably a 300 percent increase in listings with no greater increase in recoveries."

No one's going to shed a tear to hear debt collectors are having a tougher time shaking down people who are behind on their bills. Some might even cheer.
But the inability to collect outstanding bills is a serious problem for businesses, and one that could threaten a sustained economic recovery. The more bad checks or delinquent accounts a business can't recover, the greater the pressure to cut employees, who in turn might fall behind on their own bills, creating a vicious cycle.

"Many of my clients are suffering," Tavelli said. "They've had to lay off people because they can't collect their receivables."

When it becomes a choice between sending customers or patients to collections and keeping employees, businesses are increasingly choosing collections, said Chris Schumacher, president of Optio Solutions, a collection firm based in Rohnert Park.
When business was good, companies focused on growth. Now that it's gotten tougher, many are watching in horror as the bad debts on their books mount, leaving them little choice but to take a tougher approach to collect past-due bills. Read full article by clicking here