Total debt being worked by UK collection agencies has nearly tripled since 2003. But the biggest gain is in total debt purchased by debt buyers and collectors. A collection industry association in the United Kingdom said Tuesday that the amount of debt currently being worked by collection agencies has tripled since 2003.
Some $47 billion in accounts will have been referred to collectors in the U.K. by the end of this year, and that total will reach $50.4 billion by the end of 2008, according to the Credit Services Association, based in Newcastle Upon Tyne, England. The association said that the numbers reflect a near-tripling from the $17.8 billion in debt referred for collection in the U.K. in 2003.
The numbers indicate the surging consumer credit environment in the U.K. as well as an increased desire to use external agencies, according to the CSA. But the real growth in ARM dollars is in the swelling debt purchasing market, the association reports.
“There’s no question that the most rapidly growing element [of the overall figures] is debt sales,” Kurt Obermaier, CSA’s executive director, told insideARM.com. “Debt purchasing has arrived in a big way in the U.K. As the market develops, the faster it grows.”
CSA did not release official figures for debt sales in 2007, but Obermaier said that his group estimates that some $15.5 billion in debt will be sold in the year. That's 25 percent higher than the $12.4 billion in 2006 that was attributable to debt purchasing activity.