ARM Industry Turning a Corner, According to Collectors and Debt Buyers

http://www.insidearm.com/news/00038645-arm-industry-turning-a-corner-according-t/

Even with unemployment remaining maddeningly elevated and liquidation rates still at depressed, many accounts receivable management firms are beginning to see a path out of recessionary realities.

In the first quarter of 2010, many ARM professionals reported better results and liquidation rates, compared to the previous quarter and compared to the first quarter of 2009:

“Rates seemed to have bottomed out in mid-Q4 of 2009. Some Tax Season uplift, but it continued long after tax season.”

“Collection rates are better than previous qtrs. There is a slight increase in the number of accounts.”

“Liquidation seems to have bottomed out however clients continue to contract commission rates causing collection agencies to selectively work business.”

Those were some of the responses given in insideARM.com’s Credit & Debt Collection Industry Confidence Survey for Spring 2010. The quarterly survey takes the economic and operational pulse of the ARM industry.

The ARM Confidence Index, a quarterly gauge of overall industry confidence derived from the survey, reached its highest point since Fall 2008, continuing its shaky upward climb after bottoming out in Winter 2009.

Liquidation performance, one of the key measures of the Index, increased 13 percent in the first quarter of 2010 when compared to the fourth quarter of 2009. Much of that increase is due to the seasonality of collections; the first quarter typically sees higher collection rates due to early tax refunds.

But liquidation performance was also up compared to the first quarter of 2009: ARM companies reported performance levels 4.5 percent higher in Q1 2010.

For the first time, the Spring 2010 survey asked about consumer complaints against respondents’ collection firms. Nearly 44 percent of ARM respondents said that they were not aware of any complaints against their company, and the most common channel for being notified of complaints was through state attorneys general. Also, 82.3 percent of survey takers said that their company’s complaint procedure policy had been updated in the past year.

To see the full results of the survey, with data broken down by company type, please visit http://www.insidearm.com/go/confidence-survey/spring10.