Debt Collection Through Text Messaging

debt collection through text messagingText messaging has exploded over the past decade to the point where it is now the preferred method of communication for many Americans. Following its adaptation by millions of consumers, many businesses have been exploring the text message market as a way to maintain a relationship with customers through this preferred method of communication. There are quite a few companies that offer mass text messaging technology, and many businesses are using text messages as a way to deliver promotions and coupons straight to their consumer.

With all of the attention that the business community has been focusing on text messaging, it was only a matter of time before debt collectors attempted to utilize this technology as a tool to better communicate with debtors. Attempting to collect debts through text messaging is a bit of a gray area because none of the legislation protecting consumers from debt collectors specifically addresses text messaging. Most of that legislation was written well before text messaging became so popular.

Text Message Collection Lawsuits

There have been multiple lawsuits filed against various debt collection agencies regarding their use of text messaging as a means of communicating with debtors. One area where the courts have been very firm is their insistence that any bad debt collection effort conducted through text messaging absolutely must adhere to the same regulations that govern collection through voice phone calls.

Many of the companies who were sued over their use of text messaging were guilty of violating some of the principles of the Fair Debt Collection Practices Act. This includes things like failing to identify themselves as debt collectors, misrepresenting themselves, and threatening debtors.

Text Message Rules to Follow

Despite the questions surrounding debt collection through text messaging, there is no argument among collection companies that the practice works. An article written by Matt Edmunds that was posted on Inside ARM cited that text-messaging efforts improved results by 470% in a case study done by a US bank.

That level of success is hard to ignore. It is also easy to see how text messages could be an efficient way to deliver account past due notices straight to debtors before they default.

If you are considering utilizing text messaging in your own collection efforts, the big concern that you will want to keep in mind is that you need to follow all of the same regulations that you would follow when making collection voice calls. You cannot send text messages before 8 am or after 9 pm. You have to properly identify yourself as a debt collector, and should never misrepresent yourself as a member of law enforcement. You also have to refrain from threatening or using abusive language, and you must stop communication immediately if the debtor asks you to.

While it can be difficult to properly identify yourself and get your message across respectfully in a brief text message, the benefits of doing so make it worth the effort. With the way text messaging has taken over our society, it was only a matter of time before it became a part of the collection business.

Just remember to make sure that you are strict about following all of the rules and regulations so that you don’t find yourself on the wrong side of a lawsuit. If you have any questions about the regulations surrounding debt collection through text messaging, contacting a commercial debt collection agency could be a good place to find help.

By |2017-09-16T12:47:48+00:00April 14th, 2014|Blog|0 Comments

About the Author:

Graduated from University of Utah - business degree 1990. Served in US Army as an interrogator / linguist, then as a tactical intelligence officer - Military Intelligence 1986-1990. Managed Western US sales operations for NY based collection agency 1990-1992. Founded Direct Recovery Associates, Inc. 1992-present