Category: Industry Insights

Q2 2026 Industry Insights: Bumpy Inflation, Credit Hamster Wheels, and Consumer Capacity

By on July 20th, 2026 in Industry Insights
A lightbulb graphic set in front of a blue and green blended background.

As 2026 approached its midpoint, the macroeconomic narrative shifted from temporary energy-driven friction to a broader affordability crisis expanding across nearly all income brackets. Households are increasingly tapping into savings or leaning on credit instruments just to bridge the widening gap between stagnant paychecks and skyrocketing costs for core essentials like groceries, utilities, and healthcare. With more than a quarter of working-age adults who used credit cards to buy groceries were unable to pay their balance in full or lapsed on their minimum payment, repayment capacity for many continues to erode.

The latest Equifax Market Pulse Index, which combines credit behavior, debt loads, income, assets, and spending capacity into a single score from 1 to 100, dropped 1% from the prior quarter and now sits below its average. Notably, the middle-class cohort continues to shrink as consumers shift up or down in capacity, the direction of which seems to be tied to assets. Even Amazon founder Jeff Bezos commented on the starkly K-shaped economy, “You have a bunch of people in this country who are doing really well, but you also have a bunch of people in this country who are struggling, struggling to pay rent, groceries.”

For the debt collection industry, understanding consumer financial capacity is critical; with pandemic-era safety nets fully dissolving and credit card delinquencies reaching heights not seen in over a decade, traditional collection strategies are no longer viable. TrueAccord’s latest quarterly analysis evaluates these compounding shifts to guide lenders and collectors through an economic landscape defined by a concerning affordability crisis.

Key Economic Indicators

The economic data compiled throughout the second quarter of 2026 underscores a highly fragile financial situation for the average American household.

In June 2026, headline inflation eased to 3.5% annually, after accelerating to 4.2% in May. This drop was heavily influenced by reduced energy costs, which fell 5.7% in June alone after a pause in geopolitical conflict eased concerns, but this measure bears watching as the situation remains tumultuous. Core inflation—excluding volatile food and energy sectors—hit a nearly three-year high at 2.9% year-over-year in May and held there in June, signaling high prices sticking more broadly across other categories. Food prices continued rising through June, both in groceries and food away from home. 

After adding 172,000 nonfarm payroll jobs in May, private payrolls only grew by 98,000 in June while the unemployment rate held steady at 4.3%. Annual pay gains for those staying in their jobs held steady at 4.4% while edging higher to 6.6% for job switchers.

Keeping a watchful eye on resurgent inflation and geopolitical instability, the Federal Open Market Committee (FOMC) voted 12-0 at its June 17 meeting to maintain the benchmark interest rate target range at 3.50%–3.75% for the fourth consecutive meeting. Fed officials entered a prolonged wait-and-see mode, though several participants raised their year-end rate projections to between 3.6% and 4.1%.

According to the Federal Reserve Bank of New York, total U.S. household debt ticked to a new record high. Americans amassed a staggering $1.25 trillion in credit card debt during the first quarter of 2026—marking a $70 billion increase compared to the same period last year. And cardholder balances that were at least 90 days overdue spiked past 13%, reaching their highest level since 2011.

What’s Impacting Consumer Finances?

Specific structural pressures are blending together, making it intensely difficult for families to stay on top of their day-to-day financial obligations.

Stagnant wages and persistent inflation have trapped millions of consumers on a financial hamster wheel. Because food, housing, and healthcare have become significantly more expensive, families are forced to rely heavily on credit cards for everyday survival, leaving them with minimal residual cash flow to pay down outstanding balances.

Affordable living faces a twin squeeze from essential services. Due to the expiration of pandemic-era federal subsidies, millions of Americans are being exposed to the true, unsubsidized cost of health insurance premiums, which rose an average of 114% to $1,905 annually. As a result, a growing number of individuals are dropping out of ACA marketplaces entirely due to non-payment, particularly in states like Kentucky and Idaho. Simultaneously, surging summer utility costs are projected to break records as intense seasonal heat drives up residential electricity demand for air conditioning.

The student financial safety net is officially unraveling as the federal SAVE plan ended on July 1, 2026. This transition leaves millions of borrowers facing sudden monthly payment increases, forcing roughly 42% to decide between covering basic needs or servicing student debt. Defaults are already surging across the nation as the Treasury Department aggressively takes over collections on approximately 9 million defaulted accounts.

You can also read the economic tea leaves in the discount retail sector. Dollar Tree achieved a 3.5% increase in comparable store sales last quarter, fueled by a 4.5% rise in average transaction values. This growth stems from its strategy to introduce higher price points that attract wealthier, deal-seeking shoppers trading down to discount brands. Meanwhile, major retailers like Walmart report that lower-income consumers are facing extreme budget exhaustion and severe financial strain.

What’s Impacting the Debt Collection Industry?

In Q2, federal and state regulators reshaped the AI governance landscape for financial services and debt collection. In May, the Consumer Financial Protection Bureau (CFPB) issued Circular 2026-03, delivering a warning to institutions utilizing complex algorithms and machine-learning models that a proprietary or “uninterpretable” black-box AI model does not excuse an organization from its statutory obligation under the Equal Credit Opportunity Act (ECOA) and Regulation B to provide clear, mathematically sound, and specific reasons for an adverse consumer action. This coincided with a final rule from the CFPB amending Regulation B that formally eliminated the broad, unintended bias “effects test” in favor of strict, text-based enforcement and higher evidentiary standards. 

The CFPB also released their 2026–2030 Strategic Plan which outlines three primary goals aligned with the administration’s economic and management agendas. First, it aims to address pressing threats to consumers by guaranteeing fair banking, combating politicized debanking, and focusing supervision and enforcement resources on correcting tangible fraud and actual consumer harm. Second, the plan seeks to reduce unwarranted regulatory burdens through a robust deregulatory agenda that identifies, streamlines, and eliminates outdated or overreaching regulations that drive up costs for consumers. The third goal is to strengthen governance and culture through eliminating waste, right-sizing the agency’s footprint, leveraging modern technology, and fostering a strictly merit-based federal workforce.

On the state level, early mover Colorado pivoted on AI governance and repealed its landmark 2024 AI Act, replacing it with the more business-focused Colorado Automated Decision-Making Technology (ADMT) Act. This new framework removes general financial sector exemptions, mandating rigorous pre-use and post-adverse outcome disclosures alongside a guarantee for “meaningful human review” when automated technologies materially influence consequential consumer financial decisions.

The practical impact of these changes makes AI governance an operational necessity rather than a technological luxury for the debt collection industry. Because the CFPB firmly maintains that there is no “fancy new technology” carveout from traditional collection regulations, agencies must strictly audit their automated voice, text, and email platforms to prevent severe FDCPA and UDAAP violations. For debt collectors, this means heavily investing in automated compliance layers, real-time contact risk optimizers, and audit trails to track every automated touchpoint, eliminate identity verification errors, and verify that autonomous systems honor localized communication thresholds.

How Are Consumers Feeling?

Consumer sentiment metrics show a steep rise in anxiety, reflecting the strain seen across underlying economic datasets, and financial dread is climbing up the income ladder. A recent Wall Street Journal poll indicates that economic anxiety is widespread even among families earning $150,000 or more. Over 40% of these upper-middle-class respondents do not feel financially prepared for retirement, and nearly 60% report feeling severe strain from gas prices. Similarly, a CNBC survey found that 51% of Americans believe the American Dream is completely out of reach due to the ballooning cost of living.

TransUnion’s Q2 2026 Consumer Pulse study revealed that 83% of consumers rank inflation among their top three household worries, followed by recession fears at 51%. Affordability angst has hit Gen X the hardest, with this group reporting the highest levels of financial stress across all spending categories and only 28% of overall consumers planning to seek new credit.

What Does This Mean for Debt Collection?

For financial institutions, managing recovery efforts today requires a tactical pivot that prioritizes financial empathy, highly adaptive workflows, and airtight compliance strategies.

  • Transition to Analytics-Based Segmentation: The traditional K-shaped model has evolved; with upper-middle-class households experiencing intense anxiety and lower-income segments facing absolute budget exhaustion, a standard approach to collection will fail. Agencies must deploy data analytics to differentiate between consumers who have structural incapacity to pay and those who are selectively prioritizing expenses due to inflation.
  • Flexible, Low-Friction Digital Resolution Options: Given consumer budget constraints, rigid settlement demands will drive accounts directly into default. Instead, debt collectors should offer highly customizable, self-service repayment structures that allow users to build interest-free payment schedules and respect their immediate cash flow constraints.
  • Multi-Jurisdictional Compliance and Auditable AI: As federal collections decentralize and individual states step up oversight on fintech and AI algorithms, compliance agility is mandatory. Collection platforms using machine learning or automated outreach must establish strict governance policies to seamlessly adjust to state-level fair lending and communication rules.
  • Understand What’s Driving Recovery Rates: If you’re focused on supporting compliant outreach, increasing payment rates, optimizing liquidation strategies, or driving stronger ROI without simply sending more debt collection messages, don’t miss tomorrow’s webinar with experts from TrueML’s channel operations and product teams. Register here.

Sources:

Who Do Consumers Trust More? Human or AI Agents in Debt Collection

By on July 15th, 2026 in Industry Insights, Machine Learning, Product and Technology
A close up of a person and robot arm shaking hands.

As AI agents grow in popularity within the debt collection industry, there is a core question being asked by businesses – who do consumers trust more, AI or human agents? There’s an assumption that consumers will always prefer a human since they provide an innate understanding that AI technology can’t replicate. 

When we look at the data and consumer trends, the answer is more complicated and nuanced. We’re going to take a closer look at the dynamic between consumers trying to resolve financial obligations with humans and AI agents for debt collection. 

Consumer Trust in Debt Collection Often Comes Down to Resolutions

For consumers, the main goal is usually less frustration and a more effective resolution to their financial obligation. Whether it’s an AI or human agent that delivers the frictionless experience, most consumers don’t really have a preference between the two. 

There are plenty of automated systems and AI processes in everyday life that often don’t work as intended. So, consumers want digital and AI experiences to work without any hiccups. The question of trust comes in when there’s challenges in the experience like AI not understanding consumer answers, the process taking too long and more. 

The AI Agent Trust Gap with Consumers

The Parloa Consumer Patience Index report highlights that customer service automation and AI agents can cause trust issues with consumers. According to the study, roughly 30.4% of consumers have zero trust in AI’s ability to handle complex cases. What’s even more staggering is that 93% of the survey respondents said that legacy Interactive Voice Response (IVR) systems fail too often before their issue is resolved. 

Modern AI agents have to regain the trust lost by these outdated AI technology tools. It’s created a consumer trust gap that the debt collection industry should be aware of: 

  • The 3-Minute Time Limit: 55% of consumers will disconnect with an automated or AI system within three minutes if their problem isn’t solved. 
  • Frustration is Common: 61% of consumers admitted to yelling at an AI agent to get routed to a human agent faster. 
  • The Time Trade-Off: Roughly 66% of consumers would rather wait longer for a human agent because they believe AI agents aren’t as accurate. 

What This Means for AI Agents Used for Debt Collection

On the surface it might seem like consumers are against AI agents, but that isn’t the case. The same Parloa survey reported that 85% of consumers would prefer to use AI agents if it solved their problems reliably. Consumers want AI agents to be effective in debt collection because it’s a great way to avoid feelings of judgement or shame that often come with talking to another person. 

AI technology will continue to evolve and get better at solving consumer problems. In the meantime, there are a few key strategies that businesses can use to help bridge this consumer trust gap in debt collection: 

  • Easy Human Handoffs: When your business is using AI agents, make it easy for consumers to be transferred to a human agent. Ideally, the AI technology will detect rising consumer frustration through keywords or tone of voice and pull in a human agent. 
  • Give Consumers Self-Service Options: AI and human agents aren’t needed for every problem. Give consumers the ability to self-serve with payment portals attached to debt collection email and text messages. 
  • Practice AI Transparency: It’s recommended to disclose to consumers when they’re talking with an AI agent. By disclosing this up front, it reduces the risk of consumers becoming frustrating by finding out later on in the conversation. 

Which Agents Do Consumers Trust More 

Right now, trust in human agents is higher compared to AI counterparts. However, that gap is closing rapidly as technology evolves. In the debt collection industry, consumers want to trust AI agents, but businesses need to prove that the process can go smoothly. Companies like TrueAccord have shown that empathy and understanding don’t always have to come from a human voice. 

AI and human agents can both be used to offer a frictionless and consumer-centric experience for debt collection. Digital-first collection strategies empower consumers to interact when, where and how they want. The true debate isn’t about whether or not an AI or human agent is the best for consumers – the best collection strategies leverage both to provide a better experience. 

High-Performance Recovery That Puts Consumers First

Is your business looking to put a more consumer-centric emphasis into your recovery strategy? TrueAccord is a premier omnichannel debt collection agency that offers first and third-party services that put consumers first. We take the guesswork out of collections with a patented machine learning engine that optimizes engagement with each consumer.

Contact our team today to learn more about how business can increase recovery performance and consumer trust. 

Top 5 Debt Collection Trends to Watch Through the End of 2026

By on July 2nd, 2026 in Industry Insights, Machine Learning
The blog title set in front of a man holding a tablet.

2026 is shaping up to be a defining year for debt collection strategies. Consumer expectations have changed, economic pressures continue to weigh on the economy and AI technology is more essential than ever before. Some of the most successful recovery strategies proactively adjust their approach based on important trends like these. 

To help give your business a clearer picture of how to approach debt collection for the rest of 2026, we’ve compiled five trends to keep in mind.

1. Inflation Rates Are Rising

According to the recent Consumer Price Index data from May, the annual inflation rate rose to 4.2%, continuing its upward trend over the first half of the year. This increase was mainly fueled by higher energy costs that put more financial pressure on consumers. With food, housing and medical costs also rising, essentials being more expensive leaves less room in household budgets for other financial obligations. As the year continues on, experts expect that these costs will continue to go up. 

This means debt collection strategies should be looking at how to grab attention, be authentic and meet consumer expectations. Outreach that doesn’t align with these pillars is far less likely to be prioritized by consumers facing financial challenges.

2. Personalized Engagement is Key

There was a time when the standard for debt collection was a one-size-fits all approach,  simply increasing the volume of communications in order to get better results. This traditional method is even less likely to get results in the back half of 2026. Personalization is a powerful debt collection trend this year and will likely pick up even more steam. Consumers today want businesses to meet them where they are with the right time, channel and message. It’s important for digital debt collection strategies to be flexible and adjust based on how each consumer responds. 

AI technology can help businesses uncover the outreach methods each individual consumer is most likely to engage with. For example, a consumer who is in the early stages of delinquency might prefer more messages to keep the obligation top of mind.   

3. Speed is Part of Empathy in Digital Debt Collection

Empathy has been well established to be a core part of effective modern collections. However, it’s easy to forget about how much an efficient, accurate and speedy process contributes to extending empathy to consumers. One of the biggest debt collection trends in 2026 is making the repayment process more hassle-free. Self-service options are going to be even more valuable since they let busy consumers make repayments on their own schedule. 

Think of speed as its own lever in digital debt collection. There are consumers who want a slower experience and might need more space before making a repayment. AI technology can adapt to these nuances by adjusting message frequency, using a more empathetic tone or even handing off to a human agent. The goal should be to make the debt collection process less emotionally taxing for consumers.

4. Collections Compliance Should Be Proactive

Collections regulations are constantly evolving. One core market trend in debt collection is that federal regulations around consumer privacy and AI have been falling behind state action in 2026. With bellwether states like New York and Colorado implementing new debt collection and AI regulations, more states are likely to follow suit this year. 

Does your first- and/or third- party digital debt collection strategy have the capability to ensure compliance control that’s backed by legal experts? As the patchwork of state regulations becomes more complex, debt collection outreach needs to be flexible and adapt to changes in case law and regulations.

5. Improving Consumer Contact Data

Most modern digital debt collection strategies use a multichannel approach to reach consumers. By having the ability to reach out across different channels such as email & SMS, businesses meet more consumer preferences and increase the opportunity for meaningful engagement. Even better, look for an omnichannel strategy that links and optimizes channel selection based on consumer preferences. For these approaches to work, collection strategies need accurate consumer contact information across multiple channels. 

This is a big priority and key debt collection trend for the rest of 2026. Try not to wait until a consumer account falls behind to verify or fix contact data. By communicating to consumers that your business protects their data, you can build trust and make it easier to acquire verified information.

How Is Your Digital Debt Collection Performing in 2026?

TrueAccord is the premier digital debt collection agency that leverages AI technology to offer consumers an empathy-driven experience. If your recovery strategy is looking for extra support to end the year on a strong note, our team is here to help. Connect with us today to learn more about our full-lifecycle recovery solutions.  

Using AI to Communicate with Consumers – What Responsible Engagement Looks Like

By on May 22nd, 2026 in Compliance, Industry Insights, Machine Learning
A robot looking at a collection of screens set behind the blog title.

Most businesses aren’t thinking about if they’re going to use AI to communicate with consumers, but how they can put the technology in action. For companies in highly regulated industries like debt collection, it’s essential for AI to consumer conversations to be compliant and operate under responsible engagement. 

To make this notion a reality, there are four key pillars businesses should follow to implement AI for consumer communications ethically and responsibly.

Pillar 1 – Building a Proper AI Data Integrity Foundation

For top musicians and athletes, an amazing performance is the product of countless hours of practice. In the world of AI, that grounding all happens in the foundational data layer. The best AI foundations are set up to prevent hallucinations (cases where AI models make-up facts) and limit the number of context gaps the technology fills in. 

The first step to achieve this is the idea of “treasures In, treasures out”. This means setting up a highly structured and vetted knowledge base for AI tools to pull from. One of the best ways to put this into practice is with a RAG (Retrieval-Augmented Generation). Think of RAG as an open book test. Instead of the AI guessing at the answer for a certain situation, there’s a verified source of truth from your business that it can rely on to formulate its real-time response with consumers. Other key aspects of reliable foundation include: 

  • Knowledge Base Curation: Build a single source of truth for your compliance data. 
  • Structured Templates: Create response templates for sensitive consumer interactions. 
  • Vetted & Restricted Terminology: Maintain a list of approved industry terms and any banned language.  

Pillar 2 – Designing the Right Omnichannel Blueprint

After the AI is trained, your communication strategy needs a playbook to follow, using both AI and human agents, for effective communication with consumers. This way, organizing email, text and phone call conversations is done in accordance with your omnichannel strategy. It’s important for AI tools to have clear paths to be highly efficient, while always displaying the empathy consumers expect from businesses. To help with this goal, it’s important to never let an AI operate in a silo, there needs to be human oversight. 

Modern AI technology excels at dynamic intent recognition. By analyzing consumer data points in real time, the system can use this information to shift its approach in real time. For an omnichannel strategy, this equates to AI optimizing interactions based on data unique to interaction with a specific consumer, in contrast to the traditional a one-size-fits-all approach. While human agents are needed for more complex cases, AI can be effectively leveraged to take care of low-risk interactions and repetitive tasks.

Pillar 3 – Transparency in AI to Consumer Interactions

Now it’s time for AI systems to interact directly with consumers, and it’s essential for the digital handshake between them to go off without a hitch. First, responsible AI begins with disclosing to the customer that they’re talking to AI. By starting off with honesty, your business will build baseline trust and lower the risk of customers being caught off guard and ending the conversation. 

In debt-related conversations with businesses, consumers can have an undertone of shame, anxiety or even embarrassment. In these situations, many consumers may prefer interacting with AI since it strips away the emotional friction of human judgement. It often makes it easier for the consumer to calmly explore their options for repayment, smoothing out the debt collection process. 

AI systems can also monitor positive and negative keywords, which is beneficial in each scenario. If a negative keyword is mentioned by a consumer, or the AI picks up on escalating frustration, it can be trained to hand off the conversation to a human agent. Conversely, AI can match a consumer’s positivity and guide them more effectively to self-service solutions.

Pillar 4 – AI Post-Performance Review

The final and most crucial pillar of an AI tool’s communication with consumers is a performance review to foster continuous improvement and human-in-the-loop governance. Similar to a car, AI models experience performance drift as real-world consumer behavior shifts, requiring continuous calibration to keep outputs accurate. By running continuous testing on AI models, your business reduces the risk of errors or hallucinations occurring during customer interactions. 

It’s important for businesses to treat AI systems the same way as a human agent. This means working to create the following: 

  • Human-in-the-Loop Accountability: Assign clear owners who will audit AI transcripts and decisions made for consumers. 
  • Reinforced Learning: Take time to steer the AI system through feedback loops, mark optimal outcomes and manually correct missed opportunities. 

Stop Lever: Have a definitive “stop button” mechanism so if a system mistake is detected, supervisors have the ability to process immediately.

A Consumer-Friendly Experience for High Performance Recovery

TrueAccord is the premier omnichannel debt collection agency that leverages data science and AI technology to deliver a consumer-centric experience. With full-lifecycle recovery solutions, our team gets rid of any guesswork to find consumers a way forward. Contact our team to learn more about our first and third party services.

Q1 2026 Industry Insights: Energy Volatility, Tax Season and Consumer Anxiety

By on April 21st, 2026 in Industry Insights
A green and blue background with the blog title next to a lightbulb illustration.

In the first quarter of 2026, the cost of living remained the primary antagonist for American households. While grocery price growth showed signs of stabilizing, the relief was short-lived as a spike in energy costs driven by geopolitical instability and renewed inflation pressure reintroduced significant strain on monthly budgets.

In debt collection, the first part of the year brings tax season, which provides cash refunds, some of which historically have been used to repay debts. However, despite anticipating the “largest tax refund season in U.S. history,” which on paper showed an average tax refund that was 11% higher than last year, consumers have been underwhelmed with how those bumps materially impacted their finances. Higher earners saw more of a refund boost, and some people who owed owed less, but for many, their refunds ended up being negated by increased energy and other essential costs.

In our latest quarterly report, we have distilled major factors of the current economic landscape to offer recommendations intended to help borrowers, lenders, and collectors navigate these turbulent waters.

Key Economic Indicators

The economic data from Q1 2026 reveals a complex and increasingly fragile financial situation for many households. CPI rose 0.9% in March, pushing the annual rate to 3.3%. While indexes for shelter, airfares, household expenses, and education all rose in March, the biggest driver was energy prices, which surged 10.9% in a single month, primarily due to a 21.2% spike in gasoline.

The labor market in Q1 showed continued expansion with 178,000 nonfarm payroll jobs added in March and a steady 4.3% unemployment rate. While hiring remains active, the market is selective, focusing on efficiency and AI literacy as AI-driven restructuring contributed to approximately 12% of layoffs. Key job gains occurred in healthcare, construction, and transportation, while large enterprises adopted more conservative hiring. 

Based on inflation and the labor market, the FOMC held the benchmark interest rate steady at 3.50%–3.75% through March. Despite previous cuts, the Fed has entered a “wait-and-see” mode as it monitors inflation and global conflict, with minutes from the latest meeting even showing considerations for rate increases.

According to the Federal Reserve Bank of New York’s Quarterly Report on Household Debt and Credit, credit card balances increased to $1.28 trillion at the end of 2025, and credit card accounts delinquent by 90 days or more reached 12.7%, a nearly 15-year high. Aggregate delinquency worsened in Q4 2025, with 4.8% of outstanding debt in some stage of delinquency.  Auto delinquency rates also continue to trend upward, forecast to reach 1.54% for 60+ days past due accounts by year-end.

Foreclosure filings in January 2026 were up 32% compared to the previous year, after 11 straight months of increases. While delinquency rates for mortgages were near normal levels,  deterioration was seen in lower-income areas and in areas with declining home prices. 

What’s Impacting Consumer Finances?

Specific pressures are making it increasingly difficult for middle-to-lower-income Americans to manage their financial obligations. In addition to inflation and skyrocketing gas prices, electricity costs are being driven up by the massive power requirements of AI data centers. According to the U.S. Energy Information Administration, residential electricity prices rose by 11.5% in 2025 and are expected to increase by up to 40% by 2030. 

The “K-shaped” economy continues to define the consumer financial landscape, with higher-income households seeing 5.6% wage growth in March over a year ago and sustaining their spending, while lower-income earners saw meager 1-2% increases, forcing them to navigate a reality of stagnant wages and rising essential costs. 

US consumer spending remains resilient in early 2026, though growth is shifting toward services and experiences over goods. While high costs for housing and essentials squeeze budgets, consumers are selectively spending, shifting toward “cheap thrills” and necessary services like healthcare with a focus on value. 

Many student loan borrowers are also struggling to make payments, with millions more facing monthly payment increases when the SAVE plan ends. According to a recent survey, about 42% of student loan borrowers said they have to decide between making student loan payments and covering their basic needs, and 20% reported they are in delinquency or default on their student loans. In March, 43 million Americans with student loans, about 9 million of whom are in default, were notified that the Treasury Department is taking over debt collection.

What’s Impacting the Debt Collection Industry?

The industry is operating in a state of high regulatory and technological uncertainty, while the future of the Consumer Financial Protection Bureau (CFPB) remains in flux. Following a court order that blocked previous attempts to shutter the agency, Acting Director Russell Vought requested $145 million from the Federal Reserve to keep the CFPB operational only through March 2026, and is expected to continue requesting funds. However, in April, the agency continued to take steps to reduce operations, ending the lease for the headquarters’ office and filing motions to reduce the workforce by half.

While the CFPB pursues a minimal and deregulatory agenda under current leadership, state-level regulators and the Federal Trade Commission (FTC) are increasingly filling the void with their own enforcement priorities. The FTC recently published a detailed five-year roadmap laying out how it plans to police the economy through 2030, and in summary, enforcement will be broad, tech-focused and data-driven. The FTC is reaffirming its commitment to enforcing the nation’s antitrust and consumer protection laws, with a specific focus on online behavior. The agency’s priorities include fighting fraud and deception, targeting healthcare fraud, and holding large technology platforms accountable. 

At a state level, enforcement and regulations focusing on fintech, fair lending, AI, debanking, anti-DEI and cryptocurrency are on the rise. In particular, these 10 states have been leading the charge in increased oversight. With continued rapid advancements in AI technology in financial services and trailing regulatory guidelines, it is more important than ever for businesses leveraging new technologies to assess and mitigate risk through informed and strategic governance policies.

How Are Consumers Feeling?

Consumer sentiment readings show declining confidence and increased anxiety, reflecting the economic indicators. The University of Michigan Consumer Sentiment Index sank about 11% in the beginning of April, continuing a decline that began with the Iran conflict, sinking about 9% from a year ago. Setbacks in sentiment showed up across age, income, and political party demographics and in every component of the index. 

The Conference Board Consumer Confidence Index rose slightly for present situations, but the Expectations Index, which tracks outlooks for income and labor, declined by 1.7 points. Respondents are increasingly pessimistic about their future household financial situations, with consumers’ average and median 12-month inflation expectations surging in March. The percentage of consumers stating that interest rates over the next 12 months will be higher leapt from 34.9% to 42.4%, with a growing cohort believing a recession is likely within the next 12 months.

The Federal Reserve Bank of New York’s March 2026 Survey of Consumer Expectations also shows that households’ inflation expectations increased at the short- and medium-term horizons, with expectations of growth in gas prices ballooning. Respondents’ job finding expectations improved, while job loss and unemployment expectations worsened. Expectations for credit availability have also deteriorated, with more consumers expecting it will be harder to obtain credit in the year ahead. 

What Does This Mean for Debt Collection?

For businesses, navigating 2026 requires a strategy that balances operational efficiency with an acute awareness of the average consumer’s diminished purchasing power and feelings about their financial security.

  • Hyper-Personalization is Mandatory: With the “K-shaped” divide, a one-size-fits-all collection strategy will inevitably fail. Using data-driven insights to distinguish between those who can pay but are prioritizing other costs, and those who truly cannot pay due to the energy and housing squeeze will be a strategic advantage.
  • Embrace Omnichannel, Not Just AI: While AI can help scale, consumers are increasingly wary of trusting new technology. Ensure your AI tools (like LLMs and chatbots) are backed by robust data and compliance protections and offer a clear path to human support when a situation becomes complex.
  • Anticipate and Prepare for Compliance: With the CFPB’s funding and mission in constant flux, the regulatory center of gravity has shifted to the states. Collections strategies, especially those leveraging AI, must be agile enough to comply with a quickly developing regulatory landscape. Make sure your approach is grounded, compliant, and built to last—we’re kicking off a webinar series with our legal team, “AI Governance, Simplified.” to help. Register here.

Sources:

TrueAccord Sets New Debt Collection Industry Case Law

By on March 13th, 2026 in Company News, Compliance, Industry Insights
The blog title set in front gavel on a court bench.

TrueAccord is no stranger to litigating cases that establish good case law for digital collections, and the recent decision in Robertson v. TrueAccord Corp. is no exception to this. The industry has faced confusion as to whether or not a text message is as intrusive as a phone call to consumers, legally speaking. It’s one of many gray areas the debt collection industry faces. However, to date, few participants have sought to establish legal clarity through court action.

Closing some gaps to this key gray area, the Robertson decision contains several pivotal rules for digital collections, which added TCPA clarity as the cherry on top. The court found that text messages are not as intrusive as phone calls, settled the debate on whether the mailbox rule applies to debt collection emails (hint: it does!), and found that the content of TrueAccord’s text messages necessitates a finding that an automatic telephone dialing system (ATDS) was not used. Ready for more details? Let’s jump in.

Text Messages are Not as Intrusive as Phone Calls

In Branham v. TrueAccord, TrueAccord spearheaded case law finding that email is not as intrusive as a phone call, and now we have a companion case that finds the same is true about text messages. In this case, the plaintiff alleges that TrueAccord’s text messages constituted harassment under the FDCPA, and the court squarely disagreed. Here’s the key reasons why this decision was reached: 

First, the court noted that the volume of text messages sent did not rise to the level of harassment. TrueAccord sent 11 text messages in the span of 2 months. Second, the court found that the Opt-Out option in each text message (“Reply STOP to opt out”) was also a strong factor against harassment, as stopping the messages was in the plaintiff’s control. Third, the court equated text messages to emails and found both styles of digital communications are not as intrusive as phone calls.

The Court said:

“This conduct does not approach a level that would allow the Court to infer an intent to harass, especially because text messages, like letters, are easily ignored and far less intrusive than phone calls.”

Mailbox Rule Applies to Email

The Robertson court confirms again that the mailbox rule applies to email. 

The mailbox rule is a legal doctrine that states if someone puts a piece of mail into a mailbox, then there is a rebuttable presumption that the piece of mail was delivered to the recipient. This presumption can be rebutted by the recipient by presenting credible evidence that shows otherwise. As recognized in the Robertson decision, courts have been applying the mailbox rule to email since 2013, including the Fifth Circuit in 2021. If a debt collector can prove that it sent an email, then there is a rebuttable presumption that it was received by the consumer.

In the instant case, the plaintiff could not rebut the presumption. The Plaintiff alleged that TrueAccord sent the above-referenced text messages without first providing a validation notice as required by the FDCPA. As evidence, plaintiff provided screenshots of an inbox search plaintiff conducted after the litigation began showing no emails received from TrueAccord. 

TrueAccord, on the other hand, provided business records evidencing that it did, prior to sending any text messages to plaintiff, send an email to the email address of the plaintiff containing all validation notice requirements. TrueAccord received no indication of any email bounce backs or other undeliverability notices.

The Court said:

“Even though the statute requires only that the notice be sent, the mailbox rule presumes email [sic] was received…Because Plaintiff has presented evidence only of email searches performed some indeterminate time after this litigation began, she has not rebutted the presumption created by the mailbox rule.”

The Content of a Text Message Can Indicate When an ATDS is Not Used

The industry has seen endless case law over the years narrowing down what, exactly, is and what is not an automatic telephone dialing system (ATDS) under the TCPA. While it’s been generally settled since the U.S. Supreme Court case Facebook v. Duguid that the systems industry members do not qualify as an ATDS, the Robertson decision adds another decision supporting this.

In this decision, the court found that the content of the text messages themselves held the key to determining whether an ATDS was used or not. The fact that TrueAccord’s text messages included certain characteristics that would only be applicable to the plaintiff’s specific account, e.g., the debt amount, necessarily means that the system used was not randomly generating phone numbers. It’s another example of how personalization helps create a better ecosystem for all parties involved in the industry.

The Court said:

“The facts alleged by Plaintiff only plausibly support the inference Defendant did not use an ATDS… Crucially though, Plaintiff alleges the messages contained personalized information (specific debt amounts),making it implausible that Defendant sent them to her using a device that randomly generates the phone numbers to be contacted.”

Get More Insight Into Debt Collection Compliance with TrueAccord

This case is a great example of the expertise TrueAccord’s legal team puts into practice. We’re committed to following and moving case law forward that furthers our mission of bringing a consumer-centric approach to debt collection. Our digital collections process is controlled by code and sets the standard for compliance.

Do you want a firsthand look at how TrueAccord could bring personalization at scale for your accounts? Our expert team is ready to help.

Is the Best Debt Collector an Algorithm? 

By on February 20th, 2026 in Industry Insights, Machine Learning, Product and Technology
The blog title set in front of a robot waving.

There are quite a few sitcom episodes where one of the main characters is competing against technology. Whether it’s selling more paper than a website, or automating IT support, the human element in these shows always prevails. In the debt recovery industry, machine learning algorithms have stepped up to challenge humans for the title of best collector. 

At scale, algorithms have many innate advantages for debt collection over human agents. Let’s take a look at how this competition would shake out, the argument for why machine learning algorithms are the best debt collectors and how it stacks up to other technology like chatbots. 

The Benefits of Machine Learning and Algorithms for Debt Collections

One of the core reasons why machine learning algorithms can be considered “the best collector” is because they can process large datasets faster and more efficiently than humans. Algorithms can analyze data of past consumer behavior, learn the nuances of individual accounts, and adjust strategies to improve the collection approach over time. By comparison, it would take a team of humans countless hours to reach the same level of analysis and insight, let alone making the required adjustments at scale.

When data is leveraged to offer personalization at scale, every interaction with a consumer is optimized for engagement. For example, an algorithm could send an email to a consumer first. If that person doesn’t respond, the technology could try a new content template, subject line or even try sending a text instead. The speed at which algorithms can process data allows debt collection strategies to evolve to meet consumer preferences with greater accuracy.

*Curious to see how your internal collections strategy could offer personalization at scale for digital channels? Take a look at our sister company Retain and learn more about white-label debt collection software.

Deployment Speed and Compliance Risk Differences

Human collectors take significant time and resources to train. They often have to go through weeks of onboarding and need to shadow more experienced collectors before reaching out to consumers. An algorithm can often be integrated into existing collection strategies faster to make a lasting meaningful impact. Algorithms solely focus on analyzing data and behavior to optimize collections. It’s technology that has no emotional biases or “off” days that happen to every human being. 

Machine learning algorithms help enable code-based compliance. It helps ensure that all regulatory requirements for debt collection are being met with the ability to run real-time updates for any new rules and case law. This technology eliminates the “human error” factor in debt collection compliance, which reduces risk for businesses across their recovery strategy. 

When a “Human Touch” is Needed in Debt Collection

While machine learning algorithms can automate digital communications and optimize engagement, there are situations where human collectors have an advantage. Consumers with larger debt balances are more likely to prefer a human collector who can work through a more complicated situation with empathy. Even though consumer preferences are shifting more towards digital communications and self-service portals, some consumers will only talk to other people. This fact is part of the reason why it’s important to have an omnichannel collections strategy to help ensure all types of consumer preferences can be honored.

Algorithms vs. Chatbots for Debt Collection

In the debt collection industry, there have been more companies utilizing chatbots in their recovery strategy. The most common application is when a consumer visits the website, an option appears that lets that person talk with a chatbot. However, this form of self-service has some drawbacks that make it less valuable than machine learning algorithms that operate at the heart of the strategy. 

If a chatbot is powered by AI, there’s a risk of hallucinations occurring. When discussing debts, inaccurate information from an AI chatbot could lead to an increase in disputes and expose the business to legal risks. The other option is decision tree chatbots that could have trouble resolving more nuanced questions from consumers. 

The effectiveness of chatbots for debt collection has one big issue: in most cases, the consumer has to visit a company’s website to engage with it. Once a consumer goes to a collector’s website, they’ve already taken a big step towards engagement. Debt collection is often about finding the most effective ways to get a consumer’s attention and prompt action. Chatbots still require the outreach to drive consumers to a website.

AI Voice is Poised to Become a New Challenger

AI voice technology has made huge strides recently. AI voices have the ability to sound human with different tones, speech inflections and more. Even when the use of an AI voice is disclosed, the realism it can now achieve helps consumers get past some hesitancy of speaking to it. In the future, it’s likely that we’ll see more voice AI integrated into omnichannel collection strategies. While complex cases would be handled by human agents, voice AI could handle the more routine calls. This alone could significantly improve the effectiveness and efficiency of collection strategies.

Get High-Performance Recovery Powered by Machine Learning

TrueAccord has a patented machine learning engine called “Heartbeat” that creates a personalized journey for every consumer. If you’re ready to learn more about why many industry experts believe that an algorithm is the best collector, we’re here to help. Contact us today to explore TrueAccord’s full-lifecycle recovery solutions.

TrueAccord Expands Full-Lifecycle Support  with New First-Party Collection Services

By on February 11th, 2026 in Industry Insights
The blog title in front of a green and blue background.

TrueAccord is expanding its industry-leading recovery business to include a dedicated first-party collection service, designed to act as a seamless extension of clients’ brands. With this addition in the early-stage delinquency space, TrueAccord now offers a complete full-lifecycle recovery solution that bridges the gap between initial re-engagement and late-stage recoveries.

This first-party service, powered by TrueAccord’s subsidiary Sentry Credit, Inc., focuses on consumer engagement and retention rather than just liquidation. It utilizes a “HumAIn” approach to collections, supporting seasoned agents with advanced AI to deliver a brand-aware experience that feels like a natural extension of an internal team. 

“By expanding our services to address the full recovery lifecycle, we are bridging the gap between early-stage re-engagement and late-stage resolution,” said TrueAccord CEO Mark Ravanesi. “Our approach combines the precision of our machine learning engine with the empathy and experience of our professional collection team. Whether a consumer is just falling past due or is deep in the recovery funnel, they receive a convenient, digital-first experience that prioritizes retention and financial health while delivering the high-performance results our clients expect.” 

With a focus on positive consumer interactions and industry-leading recovery, this first-party expansion offers clients a seamless way to deliver their customers a consistent, empathetic experience from the very first delinquency communication. By leveraging the patented AI technology, TrueAccord eliminates guesswork and allows collections experts to focus on helping consumers find a sustainable way forward. The service is built to be both flexible and highly scalable, working directly from clients’ AR systems or its own CRM.

For more information about TrueAccord’s services, visit www.trueaccord.com or contact sales@trueaccord.com. 

Debunking 3 Common Digital Debt Collection Myths

By on February 3rd, 2026 in Industry Insights, Machine Learning, Product and Technology
The blog title set next to an image of a justice scale.

There’s no question that the debt collection industry is in a state of evolution, but one thing that persists, especially with change, is the emergence of myths. As more businesses are turning to a digital collection strategy, misconceptions are naturally going to arise with a new approach that focuses on email, text messages (such as SMS and MMS), and self-service portals. 

Let’s take a look at three of the most common digital debt collection myths, the truth behind them and how a digital-first approach to collections helps businesses. 

Myth 1: Self-Service Reduces Recovery Rates in Debt Collection

Experts agree that it’s likely this myth was born out of the dominance call-and-collect had over the industry for decades. In fact, many businesses still hold the opinion that direct contact from a staff member is the best way to improve recovery rates. The truth is that self-service portals not only improve recovery rates, but they are also preferred by the majority of consumers. 

A 2023 TransUnion data report showed that 60% of consumers prefer self-service options to resolve their debt. Self-service portals give consumers the added convenience of being able to view and manage their debt on their own time. Another study conducted by McKinsey found an increase of 15% for cured accounts after self-service options were implemented. 

The beauty of self-service is that it eliminates the “shame factor” many consumers experience when talking to someone directly about their debt. This comes into play when consumers are making decisions on which bills to prioritize. Roughly 14% of bill-payers identified “the ease of making a payment” as a key factor in their decision-making process. 

Myth 1 Status: Busted – Self-service options DO NOT reduce recovery rates. Your business could actually improve repayment performance by embracing this digital-first strategy. 

Myth 2: Digital Debt Collection Strategies Are Too Expensive

The debt collection industry is leveraging technology more than ever. When businesses see adjectives like “AI-powered”, “automation” or “digital communications”, there’s an assumption that these products and services are expensive. Even when a business is interested in taking a digital-first approach, the process of setting up email, text messages and other channels can seem costly to build from the ground up. 

While there’s always a cost to implementing digital debt collection strategies, the more traditional tactics are increasing in cost as well. For example, the cost of sending physical mail continues to increase, and businesses that rely heavily on call-and-collect often need to hire more staff to scale up collection efforts. A McKinsey report found that embracing a digital-first approach can lower the cost of collections by upwards of 15%. 

There are also collections platforms powered by machine learning like TrueAccord that use consumer engagement data to predict the next best step, making outreach more efficient. This approach paired with meeting consumers in the digital channels they prefer can improve recovery rates and help offset the cost of collections. 

Myth 2 Status: Busted – A digital-first approach to collections has the potential to help businesses recover more. Also, the increased cost to collect and agency fees often associated with traditional strategies aren’t present when the right digital-first approach is used. 

*There is white-label debt collection software that’s designed to help your internal collections strategy spend less to collect more through personalization at scale. Explore our sister company Retain to learn more today.

Myth 3: Consumers Find Collections Through Digital Channels Untrustworthy

A CNET survey found that a staggering 96% of U.S.consumers receive at least one scam message a week. There’s been a stark rise in financial scams, and many of these messages come through digital channels. This has led more businesses to think that consumers will likely find any collections outreach through digital channels untrustworthy. While this rationale makes sense, the truth is that many consumers prefer digital communications. 

Digital communication channels are key to omnichannel strategies that put consumers first. An omnichannel collections strategy means using multiple, often complementary channels to contact consumers in their preferred way. One of the key channels is email, which has gone from a “nice to have” for debt collection outreach to a necessity. In fact, surveys show that roughly 59.5% of consumers prefer to be contacted through email first. And when a business reaches out to a consumer through their preferred channel, it can lead to a more than 10% increase in payments. 

While more consumers are turned off to direct phone calls, businesses can still get attention on their device. Around 65% of consumers want their billing, payment and account information sent to them through text. A major reason consumers are gravitating more towards digital channels is because it empowers them to address the debt at their own pace 

Myth 3 Status: Busted – Even though financial scams have made consumers more careful with digital communications, their preferences for those channels still hold strong. By honoring those preferences, debt collection strategies can reach higher performance while improving customer satisfaction. 

See How a Digital-First Approach to Collections Could help Your Business

Even though we covered three of the most common digital debt collection myths, there are plenty more to navigate. By knowing the full capabilities of digital channels, your business can improve its collections strategy. The good news is that you don’t have to figure this out alone. 

TrueAccord is an industry leading debt collection agency that’s powered by patented machine learning to deliver a consumer friendly experience and improve collection results. Connect with our team today to unlock the potential of a digital-first approach.

Q4 2025 Industry Insights: Crowdfunding, Credit Cards, and a K-Shaped Economy

By on January 23rd, 2026 in Industry Insights
The blog title set in front of a green and blue background with a lightbulb graphic.

The cost of living continues to weigh on American consumers. While eggs are no longer the focus of food price pains, other household staples like coffee, beef, and candy have seen double-digit price increases over the past year. Grocery prices rose at the fastest pace in 3 years in December, and when combined with rising costs of other essentials, it’s concerning but not entirely surprising that consumers have turned to crowdfunding to cover basic needs. 

According to Bank of America economists, “The ‘K’ is here to stay”, referring to the duality seen between financial stability and spending of higher- and lower-income households. The top 5% of consumers drove the bulk of overall spending gains through late 2025, while lower-earners cut back on nonessential purchases amidst financial pressures. For those on the middle to lower end of the income spectrum, an unfavorable economic climate will put more strain on finances, leading to increased delinquency and the need for alternative sources of credit to make ends meet.

With new and persisting economic challenges and no indication of reprieve in sight, the year ahead coming out of 2025 looks challenging for consumers, especially those on the middle- to lower-end of the income spectrum. We’ve distilled the factors of the economic landscape and crafted recommendations to help borrowers, lenders, and collectors prepare accordingly.

Key Economic Indicators

The economic data from Q4 shows the financial hurdles facing many households. While the economy as a whole continues to move forward and looks strong on paper, the benefits are not being shared equally, and the real picture is complex below the surface, creating significant headwinds for a large portion of the population.

The job market has cooled significantly since earlier in the year, with employers adding only 50,000 jobs in December, and the unemployment rate settled at 4.4%. Long-term unemployment rose by nearly 400,000 people over the course of 2025.

Inflation still remains a primary concern. December data showed a 0.3% monthly increase in the CPI, with the annual rate holding at 2.7%. Essential costs continue to climb, especially shelter (up 3.2% annually) and food (up 2.4% annually).

In response to the cooling labor market, the Federal Open Market Committee lowered interest rates by 0.25% at its December meeting, landing at a target range of 3.50%–3.75%. This marked the third consecutive cut of the year, but expectations for multiple rate cuts, if any, in 2026 have dropped.

Household balance sheets are showing significant stress, with delinquency expectations having deteriorated to their highest levels since the pandemic. Notably, auto delinquencies reached 3.88% late in the year, the highest level in 15 years, and that’s not counting closed, charged off accounts. Foreclosure filings in December 2025 were up by 26% over November, having surged by 57% compared to the previous year.

Credit card delinquency gradually rose through the second half of 2025, both in terms of account volume and dollar balances, with 30-plus-day delinquency rates running higher than pre-pandemic levels. News early in 2026 about caps to interest rates has banks on edge, with potential implications for credit access at a time when consumers may need it most.

What’s Impacting Consumer Finances?

While higher earners are still faring well, lower-income Americans are struggling with wage stagnation that has not kept pace with the costs of living. Several specific factors are squeezing household budgets and making it harder for consumers to manage their financial obligations.

Grocery prices rose by 0.7% in December, the largest monthly gain since the peak inflation period in August 2022, and were up 2.4% over the previous year. Restaurants similarly felt this squeeze, and passed increases on to consumers, with costs for dining out rising by a similar amount, marking the largest monthly gain in three years. 

Utility prices are similarly starting to strain budgets, with electricity prices up almost 7% last year and natural gas reporting double-digit increases. This cost is expected to continue rising as data centers that provide the computing capacity and storage needed to power AI models add to power demands. Electricity costs near significant data center activity have increased as much as 267% per month, and as more data centers are constructed, more Americans should expect equivalent cost increases.

The federal student loan landscape is undergoing a major shift with big implications. The SAVE plan was shut down in late 2025 following a legal settlement, forcing millions of borrowers to transition to alternative, often more expensive, repayment plans. A combined 12 million borrowers are in various stages of delinquency, default or forbearance with uncertain offramps, and the Education Department announced plans to resume wage garnishment in early 2026. 

Health care costs are also going to be a big factor in budgets this year. Industry experts expect the premiums for employer-sponsored insurance have increased faster than overall inflation in 2025 and will likely do so again in 2026. Policies available on Affordable Care Act (ACA) exchanges are rising while tax subsidies for ACA coverage are expiring, which will raise rates for the 24 million people currently covered by ACA policies. For Medicaid recipients, new eligibility requirements under the One Big Beautiful Bill Act will also raise health care costs or reduce availability altogether. 

What’s Impacting the Debt Collection Industry?

The debt collection industry is adapting to a regulatory environment that is becoming more localized and a technological landscape that demands greater attention to security.

The future of the CFPB is in flux as funding disputes continue. As of the time of this publication, Acting Director Russell Vought has asked the Federal Reserve for $145 million to fund the agency from January through March. He had previously moved to dissolve the CFPB, instructing staff to cease work and halting the agency’s funding. In the meantime, the agency is aggressively pursuing a deregulatory agenda.

As federal oversight wavers, states are stepping in. At least 14 states proposed legislation in 2025 to regulate financial products, with many laws taking effect late in 2025 or on January 1, 2026. For a quick summary of the key developments from 2025, take a look at this overview from TrueML’s legal team.

The push toward AI in financial services continues, but the PwC 2026 Global Digital Trust Insights report highlights that 47% of leaders cite a lack of qualified personnel as a top challenge. An undisputed point is that implementing AI must be paired with robust data protection to maintain “digital trust”, which is a concern for regulators, businesses, and consumers alike.

How Are Consumers Feeling About Their Financial Outlook?

Consumer sentiment reflects the deep anxieties revealed in the economic data. The Conference Board’s Consumer Confidence Index declined to 89.1 in December, with consumers’ assessment of their family financial situations turning negative for the first time in four years. 

The University of Michigan Consumer Sentiment Index showed a slight rebound to 54.0 in early January, but this remains nearly 25% lower than the previous year. Furthermore, 47% of Americans believe they would not be able to find a good job in the current market.

The Federal Reserve Bank of New York’s December 2025 Survey of Consumer Expectations agreed, with job finding expectations declining to a series low and job loss expectations also worsening. While spending and household income growth expectations remained mostly unchanged, delinquency expectations deteriorated to the highest level since the onset of the pandemic, and inflation expectations increased at the short-term outlook.

What Does This Mean for Debt Collection?

For businesses with financially stressed customers, navigating this challenging environment requires a strategy centered on empathy, awareness, and trust. Leveraging AI to do this at scale offers a path to success, but will require cautious, data-driven strategies and strengthened governance to navigate evolving risks and opportunities. Here are a few things to consider:

  • Consumer expectations have evolved, your strategy must adapt. Empathy, convenience, and a customized experience will go a long way in building goodwill with consumers in debt. If you’re still relying on calling alone to drive repayments, your collection results will likely show the impact of being behind-the-times this year.
  • AI is everywhere, but how you use it is key. Whether you’re using LLMs to write emails, chatbots to field consumer inquiries, or deeper, systemic AI, you’re going to need to keep an eye on evolving regulations, auditability, and data security concerns. For example, are you prepared for consumers using agentic AI for debt collection negotiations?
  • And keep the other eye on the rapidly evolving regulatory landscape. What happens next with the CFPB will have big impacts on businesses and consumers. But either way, states and the FTC are stepping in with their own priorities for both financial services and AI regulation. Strategies will need to be informed and agile to keep up.

Sources: