Debt Collection Agencies and the Supply of Consumer Credit

88 Pages Posted: 29 Apr 2020

See all articles by Viktar Fedaseyeu

Viktar Fedaseyeu

China Europe International Business School (CEIBS)

Multiple version iconThere are 2 versions of this paper

Date Written: February, 2020

Abstract

This paper finds that stricter laws regulating third-party debt collection reduce the number of third-party debt collectors, lower the recovery rates on delinquent credit card loans, and lead to a modest decrease in the openings of new revolving lines of credit. Further, stricter third-party debt collection laws are associated with fewer consumer lawsuits against third-party debt collectors but not with a reduction in the overall number of consumer complaints. Overall, stricter third-party debt collection laws appear to restrict access to new revolving credit but have an ambiguous effect on the nonpecuniary costs that the debt collection process imposes on borrowers.

Keywords: creditor rights, law and finance, contract enforcement, household finance, consumer credit, debt col-lection

JEL Classification: G20, D18, D12, K35, G18

Suggested Citation

Fedaseyeu, Viktar, Debt Collection Agencies and the Supply of Consumer Credit (February, 2020). FRB of Philadelphia Working Paper No. 20-06, Available at SSRN: https://ssrn.com/abstract=3587648 or http://dx.doi.org/10.21799/frbp.wp.2020.06

Viktar Fedaseyeu (Contact Author)

China Europe International Business School (CEIBS) ( email )

Shanghai-Hongfeng Road
Shanghai 201206
Shanghai 201206
China

HOME PAGE: http://https://www.ceibs.edu/fviktar

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