Top Predictions for the ARM Industry

Mike Ginsberg

Earlier this month, Rozanne Andersen and I hosted the first of many live webinars. We focused on the changing landscape of the ARM industry and developing trends that we felt would impact the future of the industry. We covered a lot of ground in 75 minutes from client changes to technology advancements to CFPB and regulatory matters.

In the spirit of Twitter’s anticipated IPO, a company whose success is predicated on short bursts of content, I offer you our own quick bursts of the top predictions we made during our webinar:

• In the new world of CFPB oversight, consumer satisfaction will take center stage as the #1 KPI.
• Private student loans will rebound as some major lenders return, mid-size banks emerge and major universities start originating student loans.  – accounting for as much as 20% of the market in 5 years.
• Increased regulation will accelerate consolidation within ARM industry.
• Creditors will become subject to or held accountable under the FDCPA.
• The government will become the single largest source of new business for U.S. ARM service providers for the next decade.
• There will be less than 15 ARM companies left servicing the needs of the large financial institutions.
• Large Market Participants (LMP) status may become the industry’s Good Housekeeping Seal of Approval as large creditors will likely outsource to only LMPs in both the collections and debt buying space.
• Consolidators and roll-ups will become a part of industry history.
• The definition of the successful collector will no longer hinge solely on dollars collected, success will be tied to complaints (or lack thereof).
• Creditor oversight will become more intrusive and blur the lines that have historically defined third party collection activity.
• The intense regulatory environment is creating, for the very first time, a true barrier-to-entry in the U.S. ARM industry.
• Collections will be a growth industry for decades to come.