Debt Collection Software Market Statistics, 2027
The global debt collection software market generated revenue of $3,120 million in 2019, and is projected to garner $6,778 million by 2027, registering a CAGR of 10.2% during the forecast period. A debt collection software automates the debt collection process and provides real-time information of debtor portfolios to collectors. This software offers features such as customer segmentation based on collection scenarios, automation of customer reminders, email & notifications, streamlining communication with clients, suitable payment plans, transaction management, commission management, compliance management, invoice management, and payment management. A debt collection software can be deployed on-premise or on cloud depending upon the convenience of organizations. In addition, it is used to organize the daily work of collectors and to decrease the time spent on administrative and unproductive tasks to utilize their productive time efficiently for high-value tasks such as identifying and resolving the disputes that may prevent debt payment and negotiating with key customers in collaboration with business managers.
The on-premise segment dominated the debt collection software market share in 2019, and is expected to continue this trend during the forecast period. This is attributed to increase in need to secure critical data from cyber-threats and monitor the invasion of data within organizations, which encourage users to implement on-premises-based debt collection software. This further enables organizations to own accountability of expensive software upgrades.
However, the cloud-based deployment mode is expected to witness highest CAGR during the forecast period, due to surge in adoption of cloud-based debt collection software among both large enterprises and SMEs, attributable to the need for reducing infrastructure investment. The cloud-based debt collection software facilitate enterprises with real-time availability of operational and financial data. Thus, the cloud segment is expected to grow at a significant rate, which, in turn, is expected to boost the growth of the global debt collection software market during the forecast period.
The financial institutions segment dominated the debt collection software market share in 2019, and are expected to continue this trend during the forecast period. This is attributed to rapid digitalization among banking institutes. Moreover, debt collection software enables banks to achieve automation in the collections processes, which is expected to drive the adoption of the software among banks. However, the healthcare industry is expected to witness highest growth rate, owing to rise in patient cost and bad debt in the healthcare industry. Moreover, surge in need for technological advanced systems to eliminate bad debt and accelerate and automate revenue cycle drives the growth of the debt collection software in the healthcare industry.
North America dominated the overall debt collection software market in 2019, and is expected to remain dominant during the forecast period, due to availability of well-developed infrastructure. Thus, the integration of debt collection software among various BFSI systems becomes easy. However, Asia-Pacific is expected to exhibit highest growth rate during the forecast period, due to digital transformation and increase in willingness of consumers to adopt new technologies.
The report focuses on the growth prospects, restraints, and debt collection software market analysis. The study provides Porter’s five forces analysis of the debt collection software industry to understand the impact of various factors such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers on the debt collection software market trends.
Segment Review
The global debt collection software market is segmented into component, organization size, deployment mode, end user, and region. By component, the market is bifurcated into software and services. On the basis of organization size, it is fragmented into small & medium enterprises and large enterprises. Depending on deployment mode, it is categorized into cloud and on-premise. As per end user, it is segregated into financial institutions, collection agencies, healthcare, government, telecom & utilities, and others. Region wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
By Deployment Mode
Cloud-based deployment is projected as one of the most lucrative segment.
The key players operating in the global debt collection software industry include Atradius Collections, Chetu Inc., Experian Information Solutions, Inc., Fair Isaac Corporation, Fidelity National Information Services, Inc., Nucleus Software Exports Ltd, Pegasystems Inc., Temenos AG, Tieto, and TransUnion LLC.
COVID-19 Impact Analysis
The outbreak of the coronavirus has been posing challenges for debt recovery. Several state officials and regulators across the globe have taken initiatives to minimize the economic burdens stemming from COVID-19 on consumers in their states by placing additional restrictions on debt collection practices. For instance, on March 25, 2020, Massachusetts Attorney General (AG) Maura Healey with the Secretary of State’s Office implemented an emergency regulation designed to restrain debt collection in the Commonwealth during the COVID-19 pandemic. This regulation prevents debt collectors and creditors from harassing residents. Variations in enforcement procedures and order for payment procedures during the COVID-19 emergency and significant adverse economic effects majorly rising unemployment may make it further complicated, and in some cases, restrict the power to enforce claims.
By End User
Healthcare segment is projected as one of the most significant segment.
Top Impacting Factors
The growth of the global debt collection software market is influenced by several factors such as rise in demand to reduce bad debt & improve cash flow, surge in need for automation in the accounts receivable process, and rise in multichannel collection models. In addition, the emerging trend of analytics-enabled collections models is expected to have a strong impact on the debt collection software market in the upcoming years. However, high maintenance cost associated with debt collection services and diversified debt collection regulations across the globe may hamper the market growth to a certain extent. Thus, each of these factors is anticipated to have a definite impact on the growth of the global market in the coming future.
Surge in need for automation in the accounts receivable process
Accounts receivable are legally enforceable claims that are held by business, which has not received payment of products or services opted by end users. The need to fast track the day-to-day activities by reducing labor-intensive administrative part and transferring that burden to technology has driven the demand for automation. As automation of accounts receivable process can migrate to digital practices the debt collection software market is expected to grow at a significant rate.
Moreover, automation of debt collection and recovery process improves productivity in collections by sequentially determining reasons and reduces time required to process the cases. As organizations collecting debt are under extreme pressure to cut costs while improving processes and increasing revenue, the demand for automated debt collection solutions is expected to increase substantially. This factor is expected to notably contribute toward the growth of the global debt collection software market.
By Region
Asia-Pacific region is projected as one of the most significant segment.
Key Benefits for Stakeholders
- This study includes the debt collection software market analysis, trends, and future estimations to determine the imminent investment pockets.
- The report presents information related to key drivers, restraints, and opportunities of the debt collection software market.
- The debt collection software market size is quantitatively analyzed from 2019 to 2027 to highlight the financial competency of the debt collection software industry.
- Porter’s five forces analysis illustrates the potency of buyers & suppliers in the debt collection software market.
Debt Collection Software Market Report Highlights
| Aspects | Details |
 By Component |
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 By Deployment |
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 By Organization Size |
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 By End User |
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 By Region |
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 Key Market Players | FAIR ISAAC CORPORATION, TRANSUNION LLC, EXPERIAN INFORMATION SOLUTIONS, INC., TIETOEVRY, ATRADIUS N.V., CHETU INC., PEGASYSTEMS INC., TEMENOS, NUCLEUS SOFTWARE EXPORTS LTD., FIDELITY NATIONAL INFORMATION SERVICES, INC. (FIS) |
Analyst Review
According to the perspectives of CXOs of the leading companies, the debt collection software market is expected to grow at a promising rate during the forecast period. In addition, global debt collection software market in Europe and Asia-Pacific is growing at a rapid rate and exhibits immense potential for revenue growth. This is attributed to advancements in collection processes; rise in need for real-time, responsive, commercial, automated debt collection process; and increase in need for satisfaction of customers without compromising on the recovery of debt.
Adoption of analytics in debt collection processes is gaining traction in current years. In addition, integration of software applications with telephones and email has become important due to rise in need to analyze the relevant data. Data analytics is crucial for improving debt collection process; however, manual transfer of data makes analytics excessively expensive. Moreover, increase in awareness among businesses to improve company's collection efforts, which can lead to increase in the profits majorly drives the growth of the market. In addition, number of advanced features offered by the debt collection software, which includes accounts receivable management, credit/risk management, customer relationship management, analytics, reporting, and workflow automation solutions with integrated payment processing, is driving its adoption among end users.
Furthermore, numerous industries are shifting their focus toward digital advancement and are adapting different ways and strategic initiatives to mark their presence in the competitive environment. This has led to increase in research and development activities by companies to improve advanced products, which have a broad application base.
Majority of market players are collaborating with numerous government entities globally to optimize their debt collection process easily. In addition, stiff competition in global market is compelling companies to research & develop and innovate unique product functionalities in existing debt collection software. This, in turn, is proliferating the need for enhancements in the traditional debt collection software. For instance, integration of analytics technology when integrated with existing software is expected to overcome the challenges faced by the traditional software and enhance the product features with advanced functionalities.
The CXOs further added that the debt collection software market is a consolidated market, owing to the presence of strong players such as Atradius Collections, Chetu Inc., Experian Information Solutions, Inc., Fair Isaac Corporation, Fidelity National Information Services, Inc., Nucleus Software Exports Ltd, Pegasystems Inc., Temenos AG, Tieto, and TransUnion LLC. However, the market is expected to become fragmented in near future, as many players in developing countries are evolving in this area and introducing enhanced and innovative debt collection solutions and services
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