DCAs going bums up

[Pinky69]

New menace to the UK Debt Collection Agencies industry – Zombie companies

 

If this has happened to 50 of them, what does it say about the rest?:grin:

[dx100uk]

thought they were all zombies anyhow........

 

dx

[harrassed senior]

[cerberusalert]

hey are Zombie businesses with debts at an average of 92% of turnover – they exist to service their out of control liabilities. Many are also using their suppliers to finance their growing losses, taking twice as long as to pay their bills as the industry average of 25 days”

 

They'll be able to send threatening letters and make annoying 'phone-calls to themselves then, that'll keep them busy

[kbob]

It's gone from 27 DCA's failing back in the 7th June;

 

CCR Magazine - Small companies continue to struggle in the UK Debt Collection Agencies industry

 

Now it's 50!! The numbers are nearly doubling every month!

[Bazooka Boo]

My heart bleeds...

 

*BB waves to Guests* (Get back to work!)

[spamheed]

It's gone from 27 DCA's failing back in the 7th June;

 

CCR Magazine - Small companies continue to struggle in the UK Debt Collection Agencies industry

 

Now it's 50!! The numbers are nearly doubling every month!

 

And long may it continue, wouldn't it be nice to see some of the bigger parasitic companies in with them

[RoyalIrish]

A single tear rolls down my cheek!

[Bazooka Boo]

A single tear rolls down my cheek!

You have a glass eye?

[RoyalIrish]

You have a glass eye?

 

LOL, you saw the movie as well?

[Guest Cartaphilus]

Their day is coming ... about time too ... But what new zombie horror will arise in the aftermath of 'Day of the DCA'

[Guest Cartaphilus]

28 DCA's later

[yalnif]

The last DCA Filmed in Glasgow last year i was there on holiday and wached

[Guest Cartaphilus]

So which debt collection agency in Glasgow was it, then? Obviously, I am talking about a DCA here BTW not a movie.

Edited July 2, 2010 by Cartaphilus

[yalnif]

just joining in the fun but i did watch the last day being filmed

[mrdebts]

Hopefully they will all go bums up soon.

[kbob]

Hopefully they will all go bums up soon.

 

Well just seen the latest news on their "industry" website. Not looking good for DCAs and their investors.

 

CCR Magazine - Spending Cuts Herald Fresh Problems for Debt Collectors

 

Spending Cuts Herald Fresh Problems for Debt Collectors Tuesday, 20 July 2010 The latest budget announcements from the coalition government could trigger fresh difficulties for the debt collection industry, with revenues expected to fall by more than 14%, according to a press release from Euristix relased today.

The recent economic downturn has underlined just how dependent the collections industry is on the prevailing economic conditions. As the UK’s non-prime consumers found their access to credit cut off, so too did their ability to fund full and final settlements. Later as unemployment rose and consumer confidence fell, payment plans suffered from higher default rates and reducing instalments. The net impact of these changes for many debt collectors was a reduction in revenue in the region of 25-30%, with the largest drops driven by reduced settlement activity. The collections industry struggled under such an unprecedented slump, with reduced revenues stressing business models, straining investor confidence and all but halting activity in the debt purchase market.

Since mid-2009 some element of calm has returned to the collections sector with collections levels stabilising, albeit at a reduced level. Returning investor confidence, more palatable debt prices and the end of the recession have prompted many to begin planning for brighter times ahead. However, Euristix research shows that the recently announced government initiatives to curb spending have the potential to derail this nascent recovery. The very real likelihood of public sector job cuts has once more raised the spectre of growing unemployment. The 600,000 proposed long term job losses relate to a 2% rise in the unemployment rate, before considering the indirect impact of these cuts. At the same time a review of the benefits system will undoubtedly leave many debtors facing a reduction in income.

By using models which calculate the changing affordability and liquidity circumstances of individual debtors, Euristix have mapped the impacts of these changes onto collections performance. Unlike the impact of the credit crunch, in which reduced consumer liquidity triggered a collapse in settlements, the mechanism here is a reduction in monthly affordability. As such, the primary impact will be on payment plans, with even a relatively mild growth in unemployment and reduction in benefits triggering a fall of 15% in plan revenues. Settlement payments perform better in this mild scenario, although they still exhibit a 6% drop. In reality, Euristix expects the impacts to be more severe than this mild scenario as the economy reacts badly to rising unemployment and benefit cuts. For a standard debt collector we anticipate a possible fall in revenue of just less than 15%, driven by a drop of 21% in plan payments and 9% in settlements.

As the debt collection industry climbs slowly back to its feet, there is a very real chance that the latest government initiatives could inadvertently pull the rug back out from under it. With the spending cuts reducing the affordability of a significant proportion of debtors, collectors need to be ready for tough times ahead. As much as Euristix hate to be the bearers of bad news, there is a very real chance that the light at the end of the tunnel is indeed the headlamp of an oncoming train!

(Source - Euristix Press Release)

[cerberusalert]

The recent economic downturn has underlined just how dependent the collections industry is on the prevailing economic conditions.

Blimey, is it finally sinking into their thick heads that when people don't have the money/jobs they cannot pay?

[ScarletPimpernel]

If nothing else, it demonstrates that the debt industry is parasitic. As the host declines, so the parasite suffers too.

 

I think this also explains the recent flurry of outpourings from the risible CSA, demanding more access to data and less regulation. For a long time the industry has got away with business models that rely upon not being strictly compliant. They can see that the potential for stronger regulation coupled with the economic downturn is likely to lead to hard times for them - hence their wriggling now.

[harrassed senior]

Since mid-2009 some element of calm has returned to the collections sector with collections levels stabilising, albeit at a reduced level. Returning investor confidence, more palatable debt prices and the end of the recession have prompted many to begin planning for brighter times ahead.

The recession is over then?

 

First time I have seen the word recession and brighter times ahead in the same paragraph and relating to DCAs:eek:

[smith_j]

Blimey, is it finally sinking into their thick heads that when people don't have the money/jobs they cannot pay?

 

Oh that wont be an issue for them.

They'll still think they can get blood out of a stone

[fuzzybobble]

The only brighter future the DCA's will be getting, is most of them will be forced to find a real job and earn their money honestly.

 

Now which one of the CAG fave DCA's will be the first to go down the toilet?

[john 333]

well i for one would love to see freds and their gimp bryan carter go under. but any would be a bonus!