Collections


Ripples on the pond


Credit culture and collections in the US


Being in debt is a fact of life in the US. Indeed it is expected. Similarly to here in the UK, it is almost a necessity to incur debt – such as through the use of credit cards – in order to have established a credit record and so secure the finance to buy a house, car or indeed any item that needs to be bought with money advanced on trust. More than 70% of American adults have a credit card, according to the Federal Reserve, and in recent times, credit card spending has shown a decline, perhaps as a knock-on effect of the banks’ tightening availability of credit. A recent report by the American Bankers Association revealed that the percentage of bank-issued credit cards that were 30 days or more overdue fell to an 11-year low in the second quarter of 2012, suggesting that consumers are keeping a tighter rein on their finances. While personal debt is an area more likely to hit the headlines, perhaps the real story lies in the changing attitudes towards debt and credit in business. Generally speaking, American businesses stick to pre-established terms of trade, but that’s not to say that the cracks are not beginning to appear.


Slow growth


It had been hoped that an upturn in the American economy could lead the way for a global recovery; however economic growth in the US, which had previously been viewed as solid, has been slow and volatile over the past few months, as confirmed by unemployment figures that remain high. Although the automotive industry is in double-digit growth, lingering problems in the Construction sector


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