Dublin, Sept. 03, 2024 (GLOBE NEWSWIRE) -- The "Debt Collection Agencies in the UK - Market Size, Industry Analysis, Trends and Forecasts (2024-2029)" report has been added to ResearchAndMarkets.com's offering.
Industry revenue has declined at a CAGR of 6.9 % over the past five years, to reach an estimated £1.7bn in 2024.
Rising interest rates drive up debt collection demand In 2021-22, the UK fell into a cost-of-living crisis triggered by high inflation. The Bank of England implemented 14 consecutive interest rate increases between December 2021 and August 2023 to tame inflation. They've remained unchanged despite inflation slowing down in 2024-25, though there is speculation that interest rates will fall as inflation cools.
Debt collection agencies provide two main services: traditional debt collection on behalf of a third party, like credit card companies, where a service fee is charged on debt collected and debt portfolio acquisition, where an agency buys a ledger or portfolio of debts at a discount and collects on these debts. Revenue is influenced by the level of personal and business debt, demand for debt collection and debt recovery rates.
Agencies have been transitioning from fee-based collection services to higher-margin portfolio acquisitions, bolstered by increased consolidation activity - portfolio acquisition is more within the reach of larger agencies. However, stricter regulations, like 2021's Debt Respite Scheme, have presented challenges for agencies looking to recover credit card payments.
Trends and Insights
- Surging business confidence signals opportunities for debt collectors.
- Increased lending and borrowing activities, driven by business expansion and investment in growth, will boost the demand for credit management and debt recovery services. Contingent-fee servicing falls out of favour.
- Agencies continue to shift towards portfolio-acquisition servicing as a source of revenue due to the volatility contingent-fee agreements bring. The North West remains a significant region for debt collection.
- The region draws agencies in with its proximity to clients and sources. Manchester, in particular, is a major debt collection hotspot. Debt collection agencies come in a variety of sizes.
- Larger agencies come up against competition from small independent companies looking to start up.
- Credit card debt likely to rise as consumer confidence increases, fuelling demand for agencies
- Consumer confidence in the UK has also improved following the improvement in the UK economy as inflation cools and GDP rises. Trading Economics says consumer confidence is at its highest since December 2021. This increase is set to increase demand for debt collection services in the UK.
Key Topics Covered:
About this Industry
- Industry Definition
- Main Activities
- Similar Industries
- Additional Resources
Industry at a Glance
Industry Performance
- Executive Summary
- Key External Drivers
- Current Performance
- Industry Outlook
- Industry Life Cycle
Products & Markets
- Supply Chain
- Products & Services
- Major Markets
- Globalisation & Trade
- Business Locations
Competitive Landscape
- Market Share Concentration
- Key Success Factors
- Cost Structure Benchmarks
- Barriers to Entry
Major Companies
- Arrow Global Ltd
- Cabot Credit Management Ltd
- Metis Bidco Ltd
Operating Conditions
- Capital Intensity
Key Statistics
- Industry Data
- Annual Change
- Key Ratios
Jargon & Glossary
For more information about this report visit https://www.researchandmarkets.com/r/qgids9
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