India is becoming a new hub for a highly competitive outsourcing field -- debt collection services -- with assurances of reducing debt recovery cost and the time needed for the process.
The American industry executives say low-cost Indian operations could influence the $18 billion-a-year collections business works in America -- pushing it towards a more focused and persistent pursuit of ever smaller amounts of money, the Wall Street Journal reported on Monday.
Already, units of General Electric Co, Citigroup, HSBC Holdings and American Express are using their India-based staff to pursue US credit card debts and mortgage payments by phoning delinquent debtors or tracking their whereabouts.
Dozens of smaller Indian companies have begun offering third party debt collection services to US and European banks and other companies, the paper said.
Indian debt collectors are also opening their own offices or buying companies in North America to drum up more business. In October, for example, ICICI OneSource Ltd of Mumbai bought a large US debt-collection company, Account Solutions Group LLC of Amherst, New York, enabling ICICI to combine its low-cost Indian work force with collection agents on the ground in the US, it said.
According to Indian outsourcing executives, their operations, which have lower salary and technology expenses than their American rivals, can significantly reduce debt recovery costs and make it worthwhile for US companies to go after even the smallest of debts.
The Indian firms' 24-hour service, said the paper, can also improve recovery time.
