Collections Agencies seeing more business

LAND O' LAKES - A recession rarely leaves any business or industry untouched. Such is the case with collection agencies.

"We are very, very busy," said Kathy Thompson who works for a company called RSI.

According to the Commercial Collection Agency Association, the amount of money placed in collection has increased by nearly 25 percent versus the same time last year.

"It's a double edge sword," claimed RSI's President, Mike Buccina.

When the construction industry slowed to a crawl the amount of money owed to subcontractors increased dramatically. That means more money for RSI to collect, which is one edge of that sword.

The problem is, in a tough economy, collecting all that money takes a lot more work. "We're working ten times harder than we used to," Thompson said.

"As far as being more labor intensive on our side our costs have gone up so the current situation isn't good for anyone," said Buccina.

There is another trend in the collections business, companies willing to wait longer and accept less money in each payment.

"Balances that were typically paid in one or two payments are now taking two, three, six months or even longer," said Buccina.

Despite the tough times, the Commercial Collection Agency Association says companies like RSI are able to collect more than 40 percent of the money they are owed.