The latest TransUnion Debt Collection Industry Report 2025 paints a picture of an industry under pressure. The response from companies is clear, but it is still far from being implemented across the board.
Anyone who has to collect more debt while having less leeway doesn’t need better processes. They need different ones. The Debt Collection Industry Report 2025 describes an industry that is at exactly this juncture and shows just how varied the responses are.
Volume is growing, but margins aren’t
Receivables management acts as a barometer. It measures what remains hidden from other industries: how many households and businesses can no longer make ends meet at the end of the month. The data from Germany speaks for itself: In 2025, German local courts recorded over 24,000 corporate insolvency filings, a 10.3 percent increase from the previous year and the highest level since 2014. At the same time, the number of consumer insolvencies rose to 77,219, an increase of 8.4 percent. This marks the third consecutive year of significant growth.
What this means for the debt collection industry can be put into an international context. The seventh annual TransUnion Debt Collection Industry Report, which surveys executives and managers from collection agencies, law firms, debt buyers, and creditors in North America, shows that 75 percent of companies expect case numbers to continue rising, with nearly half anticipating an increase of at least 10 percent by 2026. The pressure is structural, not cyclical.
The problem is this: Growing volume does not automatically mean growing revenue. While 64 percent of the companies surveyed report an increase in account volume, 28 percent also report a decline in liquidity. The industry is growing in volume but struggling to maintain margins. According to the study, cost control is the most frequently cited concern; 58 percent of respondents are at least moderately concerned. Handling more cases with fewer resources: That is the structural challenge to which the entire industry is seeking a solution.
93 percent say yes to AI
The answer the industry has agreed on is technology. And the willingness to invest is remarkable: 76 percent of companies plan to increase their spending on technology solutions over the next two years. As a result, technology budgets are growing faster than any other cost category. At the same time, the perspective has shifted. While 28 percent of technology investments in 2024 were still primarily driven by compliance requirements, that share has fallen to 14 percent. Today, 48 percent cite increasing agent productivity and improving margins as their main motivation. Technology is no longer seen as a regulatory obligation, but as a competitive advantage.
AI and machine learning play a central role in this. 93 percent of the companies surveyed are already using AI or are actively exploring its use, compared to 73 percent the previous year. Those with no AI plans whatsoever now represent a small minority at 7 percent. However, this figure masks a considerable range: Many companies, especially smaller ones, are still in the evaluation phase. Thus, 93 percent of the industry does not equate to 93 percent implementation.
People stay the same, tasks change
This leads to the truly crucial question: How is AI changing the inner workings of this industry, beyond adoption rates? A common misconception is that AI is replacing people in receivables management. The TransUnion report paints a more nuanced picture.
The most common areas of AI application are quality assurance and compliance, as well as chat and written communication—both at 47 percent—followed by scoring and treatment strategies at 45 percent, and voice communication at 44 percent. AI thus primarily handles repetitive, rule-based, and data-intensive tasks: prioritizing accounts, managing communication, and monitoring compliance in real time. What remains is the work that requires judgment.
What this means for the workforce is also reflected in HR strategies: 69 percent of companies rely on recognizing and rewarding employee performance as their most important retention measure, while 62 percent focus on flexible work models. The goal is not to reduce headcount, but to deploy personnel more strategically. The change affects tasks more than it does people: away from manual workflows and toward more complex judgment-based work that AI cannot yet perform.
Structural Change as a Business Model
What the TransUnion study describes as an industry trend has long been an operational reality for individual companies. coeo is among the debt collection firms that are not merely anticipating structural change but are actively shaping it. As a technology-driven company with AI-supported processes throughout the entire receivables chain, coeo is already operating under a model that the study describes as the ideal state for the majority of the industry: technology boosts efficiency, while specialized teams focus on relationship management, complex cases, and strategic decisions.
The question that the TransUnion report raises for the industry is not whether AI will change receivables management. It is: Who will shape this change, and who will be shaped by it?
About the Study: The Debt Collection Industry Report 2025 was published by TransUnion in collaboration with Receivables Info and authored by industry veteran Adam Parks. This is the seventh annual edition of the report. The survey polled executives and managers across the entire spectrum of the receivables industry in North America, including collection agencies, debt buyers, law firms specializing in collections, BPO providers, and original creditors. The survey was conducted anonymously. For the 2025 edition, the questions were specifically expanded to include topics such as digital transformation, the use of AI and ML, and risk management. The primary survey is supplemented by secondary data from consumer finance studies, national economic indicators, and proprietary TransUnion analyses.
Cover image © venusvi