NAPKA: banks began to sell debts of Russians to collectors 23 percent less often
Since the beginning of 2021, Russian banks have offered collectors to buy debts of the population in the amount of 171.6 billion rubles – 23 percent less than in the same period of 2020, writes RBC with by reference to the report of the National Association of Professional Collection Agencies (NAPCA). Recoverers believe that Russians' debts have become less likely to fall to them due to the rise in prices on the market.
The number of cases for sale for ten months of this year decreased by 20 percent to 1.2 million. Banks sell debts to collectors as part of an assignment (assignment of claims). In this case, the claimants buy out the debt obligations in full, and do not work for a fee on behalf of credit institutions.
Supply dropped by more than a third at the height of the 2020 pandemic. Then collectors regarded this trend as a temporary phenomenon, expecting an increase in sales next year. However, their forecasts did not come true – NAPKA analysts believe that the volume of supply in the cession segment by the end of the year will reach 226 billion, which is 13.7 percent worse than in 2020.
Among the reasons for the stagnation of the cession market, the claimants name the rise in prices sold portfolios of debts. In 2021, the average closing price of a deal nearly doubled to close to 10 percent of the original debt. According to Pavel Mikhmel, Managing Director of the First Collection Bureau (PCB), the increase in the price of transactions occurred due to a change in the structure of the portfolio being sold – there are more “young” overdue debts in it.
The share of delinquencies up to one year and from one to two years has doubled. “The stocks of the old NPL (non-performing loan, overdue loan) are sold out, a younger, and therefore more expensive, delinquency is entering the market,” explains Alexander Danilov, head of the online platform for the sale and purchase of individual debt.
Viktor Semenduev, Senior Vice President of the collection agency Kreditexpress Finance, names another reason for the reduction in supply. “Market participants understand how to deal with debts at the judicial stage, and many are investing in the development of their own collection process,” he said.
Recently, NAPKA reported that about 7-8 million Russians may face problems when traveling abroad due to debts. Residents who are overdue in payment of debts for more than 90 days and in the amount of more than 30 thousand rubles will not be able to leave the country. According to statistics, one in six borrowers may find themselves in this position, provided that the lender receives a court decision.