Experts Weigh In: Will 2021 Be Better or Worse Than 2020

To many, 2020 was a dumpster fire of unprecedented proportions. But to many in the ARM industry, 2020 was a pretty good year, all things considered. asked eight experts — Jack Brown, Jeff Freedman, Kelly Parsons-O’Brien, David Schultz, Jack Gordon, Christy Barger, Michael Lamm, and McKay Bird — will 2021 be better or worse than 2020. Here is what they said.

Jack Brown, Gulf Coast Collection Bureau

I am an eternal optimist and always think that tomorrow has the potential to be better than today. In my opinion, 2021 will be a year of mixed results for the ARM industry. For agile, forward thinking agencies 2021 will be a year of great opportunity. For companies that are slow to adapt to the new rules and the technology to enable them, 2021 will be a real challenge.

Jeff Freedman, MRS BPO

With President Trump signing off on the bi-partisan legislation for another round of stimulus, this should bode well for the industry. What is somewhat unknown at this time is how much it will be and whether customers will be as inclined to use that money again to pay down debt. We are forecasting a very strong 2021 that should match 2020. We believe this for the following reasons:

  1. We believe customers will continue to pay down debts with this extra cash in hand.
  2. We believe there will be a sizable increase in placements in 2021, particularly in certain asset classes like bank and retail card.
  3. While not ideal, the CFPB rules do provide some additional clarity that should allow more agencies to dip their toes into the digital space, helping to generate additional revenue (or reduce costs to collect). At MRS, we are planning significant technological investment in 2021.
  4. The vaccines should aid businesses in reopening allowing for more people to return to work. Lower unemployment is always better for our industry.

Despite the very strong economic results in 2020, we are thrilled however to be turning the page to 2021 and hoping for some return to normalcy.

Kelly Parsons-O’Brien, Pacific Credit Services

I am perpetually positive so my gut reaction to this question is that it will be better. With that said, I see many bumps in the road ahead. For many small businesses the new debt collection rule is going to be challenging without the right support from their technology vendors. The constant “debt collection is bad” theme within the Democratic leaders is a concern for me. And lastly, we are not going to be done with COVID as soon as the clock strikes 12 and we enter into 2021, so we will still have that to navigate. With all that said we are a strong industry filled with amazing individuals working hard to battle these challenges everyday and I am confident we will weather this storm. Cheers to a healthy and prosperous 2021!

David Schultz, Hinshaw Culbertson

Overall, I think 2021 will be better for the ARM industry. The new stimulus program should help the economy, which in turn should help the industry. The 2020 Covid restrictions that some states have in place on litigation matters should be lifted, and that should free up a backlog. I’m a bit concerned that even after all the time and effort that went into the CFPB’s new rules, there may be an effort to undo them in 2021. And from a mental health perspective, it will be nice to have 2020 behind us all.

Jack Gordon, WebRecon

2021 will be a better year for almost everyone, but debt collectors? They are fighting for relevance against AI bots, creditor clients and competitors for work. They are still getting sued by consumers, disrespected by the media and blocked by phone carriers. There is little sign that any of that will be better in 2021.

On the other hand, they are probably about to get a LOT of new accounts from the recession. They are getting some new rules from the CFPB that may make their jobs easier, or at least less confusing. The pandemic will likely start to recede as a viable reason for nonpayment as the year goes on.

I don’t know if it will be a better year or a worse one. But I do know there has never been a more interesting time to be in the collection space.

Christy Barger, Cornerstone Support

I’m optimistic that ‘21 is shaping up to be a better year for the ARM industry, based on numerous collection licensing conversations I’ve had over the past several months. We have seen promising signs such as new startups getting licensed, established agencies adding branches, and entities licensing for related financial service verticals as well. If these recent investments of time and capital are any indication, then our industry could have a great year ahead.

Michael Lamm, Corporate Advisory Solutions

I can’t be more happier to close the book on 2020 – what a roller coaster of a year! It was certainly the year of “change” and adapting to the “new norm”, both personally and professionally. The ARM industry continues to amaze me from agencies moving operations to a remote collection environment to dealing with states prohibiting collections to finally seeing after 40+ years, the FDCPA being modernized! The industry is quite resilient and always seems to adapt to the current market conditions.

2021 will certainly be another volatile year but I do think that technology will become a major driver for efficiency gains as “defaults” increase. We will see a lot of M&A activity that relates to digital ARM in 2021 and will see more of a convergence between digital ARM tech companies and traditional agencies, law firms and debt buyers.

I also believe that with additional consumer stimulus 1Q21 will likely lead to record collection performance which will help companies navigate thru the challenges in the back half of next year. On the regulatory front, I fully expect that the Biden administration will ramp back up the CFPB’s supervisory initiatives and our industry will be under the microscope which will lead to more enforcement related actions against ARM companies as well as creditors. During the next four years, it will be critical for the industry’s voice, from an advocacy perspective, be heard at the state and federal level. This is not the time for the industry to be reactive.

I am excited to see what new curveballs will be thrown at the industry in 2021 because I am confident the industry will continue to “survive and thrive” through these volatile times.

I wish everyone a happy New Year and all the best in 2021!

McKay Bird, TCN

As a result of the election cycle and impending change in the White House, we expect to see additional regulations surrounding TCPA, CFPB, and FCC. We are already getting wind of several major telecom providers filing extensions of the STIR/SHAKEN implementation deadline, which is set for June 30, 2021. Come January 20th, we can expect to see more consumer-friendly policies enter the House on Capitol Hill.

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