Debt Collection Research Articles

Performance measurement using intuitionistic fuzzy sets: A case study from debt collection centers

Performance measurement (PM) is a vital aspect of management, conducted periodically to assess the success or quality of a specific process or an organization. Performance encompasses both goals and relational models crucial for achieving those goals within a given time frame. From another perspective, performance measurement is about determining related performance indicators and providing a numerical summarized result which can be used for comparisons. Converting various indicators to an overall performance score can be modeled as a multi-criteria decision making problem. In this study, we focus on performance measurement of debt collection centers which are organizations specialized in collecting money from debtors. To this end, a decision model is developed and intuitionistic fuzzy Analytic Hierarchy Process is used to obtain the criteria weights. The proposed framework is shown in a real-world case study.

Fraudulent act: essence and legal regulation

The article examines current issues of science and practice regarding the definition of the essence, signs and legal regulation of a fraudulent transaction as one of the types of contracts in civil law. The importance of the category of “deeds” for civil law is emphasized. Modern scientific positions on understanding the essence of the “fraudulent act” categories are defined and analyzed. The author's vision of the understanding of the above-mentioned category is proposed, under which, in a general sense, a transaction is defined where the debtor (as one of the parties) performs dishonest actions in order to avoid fulfilling his or her obligation to the creditor. The necessity of forming a unified approach to defining the essence of the category of fraudulent transaction is emphasized. The principles of civil legislation, which are violated as a result of the conclusion of a fraudulent transaction, and the court practice on this issue are defined. The essence of the violation of the principle of good faith when concluding a fraudulent transaction is clarified. The need to make appropriate changes to the current civil legislation of Ukraine in order to standardize judicial practice and eliminate existing legislative gaps is emphasized. The judicial practice is analyzed and a review of court decisions regarding the fraudulent transaction and its essential conditions is carried out. It has been established that private law instruments should not be used by participants in civil transactions to avoid paying a debt (money, damages, damage) or to execute a court decision on debt collection (money, damages, damage) that has entered into force. The article notes that a fraudulent contract can be both paid and unpaid. A paid fraudulent contract has its own specifics and features that distinguish it from another fraudulent contract (for example, a free one). The right to evil is singled out as a sign of a committed fraudulent act. Further prospective directions of scientific research on certain issues of fraudulent transactions have been established.

Institutional Effectiveness of Tax Debt Collection in Increasing State Revenue

Tax debt collection is an important element for optimizing state revenue, but until now it has not run optimally. The process of collecting tax debts in Indonesia is often long and complicated. Tax collection faces obstacles such as short billing expirations, regulatory complexity, and unwieldy sanctions. The solution to this challenge involves improving regulations, increasing taxpayer awareness, strengthening institutions, and mitigating external factors affecting tax payment. This research is expected to provide an evaluation of the effectiveness of institutional mechanisms in enhancing tax debt collection for state revenue in Indonesia and an analysis of the current institutional regulations governing tax debt collections, providing insights into potential areas for reform and improvement.

Analysis of Handling of Default Cases in Debts and Receivables of the Deputy Regent of Sidoarjo

This article discusses the phenomenon of breach of contract in debt collection issues by taking a case study of breach of contract involving the Deputy Regent of Sidoarjo. Through conceptual review and tracing of specific cases, this article explores the legal and social implications of breach of contract in lending relationships. By analyzing legal approaches and related court decisions, the article aims to provide deeper insights into how the law handles contract violations and their consequences, particularly in the realm of governance. The implications of the findings of this article also discuss the need for honesty, responsibility, and fair law enforcement in maintaining public trust in legal institutions.

A Comparative Perspective on Fee Policies Used in OECD Countries for Financing Higher Education

One of the biggest problems faced by countries globally is the financing of higher education. Especially in the face of increasing demand for higher education and limited public resources, countries are in need of reform in terms of financing higher education. In recent years, there has been a global trend towards the adoption of higher education financing strategies that focus on cost sharing. The purpose of this study is to examine the higher education financing policies of countries with different systems compared to Turkey, to address the financial challenges in Turkish higher education financing, to recognize alternative financing options and to suggest strategies for Türkiye to expand its financing sources. For this reason, the study is “descriptive” and the data on the countries are analyzed by using the “documentary scanning” method. A comparative perspective on higher education financing is presented by analyzing the current higher education financing policies in OECD countries and their current remuneration schemes. The study covers all OECD member countries. As a sample, the current state of financing models and fee structures in seven countries, including the United States, Australia, Germany, the United Kingdom, China, Japan, Russia, the United States, Australia, Germany, the United Kingdom, China, Japan and Russia, each with different higher education finance policies, are presented. In order to improve higher education financing in Türkiye, it is suggested that the “Income- Contingent Loan” method, which is offered to the student on an optional basis in the collection of debts in higher education financing systems, should be implemented as an alternative student borrowing method, even if it is not generally used in every country.

Pengaturan Hukum Terkait Penggunaan Telepon pada Penagihan Peer to Peer Lending

Peer to peer lending (P2PL) is an online-based money lending platform. P2PL billing is very diverse even though it has been regulated in several regulations in Indonesia but still requires continuous study. The objectives of this study are (1) To find out the reasons for the need for more detailed legal rules related to debt collection procedures in P2PL and (2) To find out the future legal rules regarding P2PL debt collection procedures that have not been regulated in Indonesian laws and regulations. This research uses normative juridical research using statutory, conceptual and comparative legal approaches. The result of this research is the reason for the need for more detailed legal arrangements related to debt collection procedures in P2PL is to achieve justice in the form of balance for the parties involved in P2PL and the detailing of billing arrangements by telephone means which are explicitly stated in the legislation by categorizing continuous telephone ringing and conducting telephone conversations repeatedly with the intention of disturbing, abusing, or harassing someone at the intended number in the category of violence and the obligation to disclose the identity of P2PL debt collectors in every collection in any form.

SISTEM INFORMASI PENAGIHAN TUNGGAKAN HUTANG BERBASIS ANDROID PADA KOPERASI KONSUMEN UTAMA BERKAH MADANI

Koperasi Konsumen Utama Berkah Madani is one of the financial institutions that has visions of becoming an excellent, trustworthy, independent, and healthy financial institution in order to prosper the economy of its members in particular and the society in general. One of its business areas is selling consumer goods at relatively cheap prices but in good quality with cash or in installments. The problems it currently encountered are all the datas such as customer informations, debt collections, and transaction datas are still being recorded manually which are prone to being lost and damaged. This causes it to take longer time to recap monthly transactions. The purpose of this research is to analyze and design an Android-based Debt Collection Information System at Koperasi Konsumen Utama Berkah Madani. The methods used by the author are observations, interviews and literature study. As, the analysis and the system design uses Unified Modeling Language (UML). The conclusions of this research are : 1. The application consists of web (back-end) and Android (front-end) which can be accessed in realtime with the same server. 2. Designing an Android-based information system can help it record all the data it needs.

Aspek Hukum Penggunaan Jasa Pihak Ketiga (Debt Collector) oleh Pihak Leasing Berdasarkan Peraturan Otoritas Jasa Keuangan Nomor. 35 Tahun 2018 dalam Upaya Penagihan Kendaraan Roda Dua terhadap Debitur yang Melakukan Wanprestasi

The purpose of this study is to analyze the legal aspects of the use of third party services (debt collectors) by leasing parties based on Financial Services Authority Regulation No. 35/2018 in efforts to collect two-wheeled vehicles against debtors in default. 35/2018 in efforts to collect two-wheeled vehicles against debtors who make defaults The type of research in this study is normative legal research. The research in question is research that has characteristics including gaps in legal norna / principles, does not use hypotheses, uses theoretical foundations / theoretical studies and uses legal materials consisting of primary legal materials, secondary legal materials and tertiary legal materials. The results of this study indicate that: (1) The position of debt collectors in the leasing company is as a collection officer not an execution officer, execution can only be carried out by a bailiff with a court decision as in Article 32 of the Fiduciary Guarantee Law paragraph (2). The legal relationship between debt collectors (collection service companies) and creditors, namely debt collectors when carrying out their duties, act based on the power of attorney given by the finance company to the debt collector to collect or collect collateral objects from debtors. Likewise, in POJK No.35/2018 article 50 Financing Companies can cooperate with other parties to carry out collection functions to Debtors. (2) The legal consequences of withdrawing motorized vehicles against debt collectors, debt collectors will be held criminally liable and sentenced to criminal sanctions as stipulated in the Criminal Code as criminal law in Indonesia if the implementation is not in accordance with procedures, as well as the creditor in this case leasing can be sued by the debtor and ask to compensate civilly for the act of withdrawing motorized vehicles by debt collectors if the withdrawal has violated existing provisions and violated the agreement agreed upon by the creditor and the debtor. However, if the implementation is in accordance with the procedure, it must be protected in accordance with applicable laws.

Analysis Of The Implementation Of Internal Control System On Non Performing Loan (A Case Study On Bank BJB KCP Cicurug)

This research aims to determine the implementation of internal control systems on credit delinquency in Bank BJB KCP Cicurug. The variable used in this research is the internal control system. This research is a qualitative study using a qualitative descriptive method, where data is collected from the research object and the internal control system in Bank BJB KCP Cicurug is analyzed. The data collection methods used in this research are interviews, observations, and literature review. The results of the research show that Bank BJB KCP Cicurug has implemented a comprehensive internal control system in managing credit risks. The credit granting process is conducted through strict evaluation stages, including credit feasibility analysis and financial assessment. Credit monitoring and supervision are carried out continuously to identify potential credit delinquencies and take appropriate actions. Bank BJB KCP Cicurug also has accurate and transparent accounts receivable recording procedures and a professional debt collection team. Additionally, the bank has a careful bad debt provisioning policy to manage problematic debts. Although the internal control system implemented by Bank BJB KCP Cicurug has significantly contributed to managing credit risks, the research also identified several challenges that need to be addressed.

Racial disparities in debt collection

This paper documents that Black and Hispanic borrowers are 52% more likely to experience a debt collection judgment compared to their counterparts, controlling for socioeconomic variables including income, credit scores, delinquent debt balances, and other relevant credit characteristics. Statistical discrimination mechanisms such as spatially targeting collection efforts based on the likelihood that an attorney represents the defendant or that the defendant will contest the debt in court do not explain the racial gap in judgments. We find support that the judgment gap is partially driven by taste-based discrimination, as evidenced by minorities having less 90-day past due debt balances than non-minority borrowers when controlling for model covariates. Furthermore, the disparity primarily affects non-delinquent borrowers, indicating higher levels of creditor discretion in initiating judgment proceedings. A back-of-the-envelope calculation suggests that the racial wealth gap explains at most 48% of the racial disparity in judgments.

Tax Debts Pose a Significant Challenge for Tax Institutions

In 2020, the Tax Administration of Kosovo implemented a tax debt collection reform with three main objectives. 1) Consolidation of personnel from 10 regional offices into a centralized facility; 2) Equitable allocation of work responsibilities; 3) Enhancement of debt collection efficiency. During the period from 2020 to 2022, the implementation of the reform resulted in a substantial improvement in debt collection efficiency, exceeding 100% compared to the pre-reform years. Currently, tax officers handle debt collection cases with well-defined responsibilities and tasks, and the distribution of duty is more fair. This study investigates the involvement of top management and staff in the development and reform of the Kosovo Tax Administration's debt collection function. It also compares its participation with that of other Balkan countries. Tax authorities in developed nations have constructed their tax systems around the concepts of taxpayer self-assessment and voluntary tax compliance. Consequently, each tax revenue agency must establish an environment that facilitates taxpayers in declaring and remitting taxes while also implementing measures to combat informal economic activities and promote legitimate business operations. These efforts are crucial for achieving optimal levels of voluntary compliance and fostering public confidence in the tax administration.

Tindak Pidana Pengancaman dan Pemerasan dalam Penanganan Kasus Pinjaman Online

Advancements in technology have simplified various daily activities. However, this progress has also been exploited by illegal online loan services (pinjol) offering loans to people with low financial literacy, making it difficult to distinguish between legal and illegal services. Technologically-based loan solutions, originally intended to meet the community's urgent and long-term needs, have now been misused. This development has led to many risks and has given rise to various criminal acts, including fraud, extortion, and threats related to information and technology. The purpose of this study is normative juridical, using secondary data with qualitative data analysis methods. In Criminal Decision Number 438/Pid.Sus/2020/PN Jkt Utr, there is an explanation regarding legal protection for online loan borrowers against extortion or threats by debt collectors through electronic media. The judge decided on the second alternative accusation in the name of the defendant, Dede Supardi Bin H.Supriadi, based on Article 45, paragraph (4) Jo. Article 27, paragraph (4) of the Law of the Republic of Indonesia No. 19 of 2016 is an amendment of Law No. 11 of 2008 on Information and Electronic Transactions and Law No. 8 of 1981 on Criminal Procedure Law. Criminal charges can be imposed on the debt collectors involved in this case.

Legal Implications of Personal Data Misuse in Emergency Contact Information for Online Loan Services

This study investigates the legal risks associated with being an emergency contact or the absence of emergency contact in online loans. Utilizing a Normative Juridical approach, the research evaluates the effectiveness of legal policies in minimizing these risks. Findings reveal that serving as an emergency contact may lead to inconvenience due to frequent communication from debt collectors, while the absence of emergency contacts poses challenges for lenders in contacting borrowers, resulting in potential financial losses. These results underscore the importance of implementing efficient legal measures to protect both borrowers and lenders in online lending transactions. Highlights : Importance of Legal Policies: Evaluating the effectiveness of legal policies in minimizing risks associated with online loans is crucial for ensuring the protection of both borrowers and lenders. Role of Emergency Contacts: Investigating the impact of emergency contacts on mitigating legal risks sheds light on the practical aspects of borrower-creditor communication in online lending transactions. Financial Implications: Understanding the financial consequences of lacking emergency contacts in online loans underscores the need for comprehensive risk management strategies in the digital lending landscape. Keywords: Online loans, Legal risks, Emergency contacts, Normative Juridical approach, Financial implications

Profitability measurement of selected Islamic Shariah-based private commercial banks in Bangladesh: A comparative Study

The purpose of this study is to analyze the profitability of five selected five Islami banks with a Shariah foundation and to determine whether these banks are more or less profitable. This study makes use of secondary data that was gathered from selected banks' annual reports between 2013 and 2022. This study employed a parametric approach; comparisons were assessed using descriptive analysis; the ANOVA test was used to assess reliability; and multiple regressions was utilized to assess impact. SPSS version 2014 is utilized for multiple regression analysis, and Excel 10 is used for ANOVA tests. The results indicate that the profitability of the selected banks is fairly high, with every bank under examination achieving favorable outcomes. The percentage of deposits with assets and the distribution of assets among the sample banks are not moderate. The inadequate asset allocation of FSIBPLC is indicated by its low return on assets. Furthermore, the bank has a deficiency in the area of net profit margin (NPM). Additionally, SIBL's debt collection and repayment are inadequate. Investors will be deterred from investing by the significant variations in return on equity found in almost every bank during the research period. Reducing overhead costs and enhancing the appropriate distribution of loans and advances will boost operating income and net profit efficiency. Above all, FSIBPLC and AIBPLC have fared well across the board. To optimize their profitability, the three remaining banks—IBBPLC, SIBL, and UBBPLC—had to step up their efforts.

The low self-efficacy trap: why people with vulnerabilities experience prolonged periods with payment problems

IntroductionSocieties place a responsibility on individuals to pay what they owe on time, establishing a coercive apparatus for debt collection and enforcement when they do not, coupled with consumer protection and debt resolution measures to protect the vulnerable.MethodsAn analysis of in-depth interviews with 28 people with both payment difficulties and vulnerabilities from ill-health, using Bandura's Social Cognitive Theory to explore the experiences of vulnerable defaulters as they try to exercise the personal responsibility placed on them by society.ResultsIt finds that they encounter barriers in exercising the personal responsibility which primarily arise in encounters with inflexible and bureaucratic routines – of creditors, debt enforcement agents and even money advisers whose role is to help vulnerable people. These systematically undermine defaulters' self-efficacy, and leaving them facing prolonged periods of payment difficulties.DiscussionThe findings are discussed in the light of Bandura's Theory and lessons drawn for the policies and practices of creditors, debt enforcement bodies, and money advisers.

Nonperforming Loan Disposals Without Resolution

Using proprietary data on nonperforming loan (NPL) transactions in China, we document that banks conceal NPLs in disposal transactions that are supposed to resolve NPLs. In these transactions, banks provide financing and retain the credit risks and debt collection obligations. Transaction prices contradict underlying credit risks: Despite being delinquent for 4.5 years, the median NPL package is sold at face value with zero haircut. The majority of NPL packages are resold at a premium to banks’ non–government-owned borrowers, further supporting the concealment view. Banks under stricter regulation conceal NPLs more and engage in more illicit concealment. NPL-concealing banks increase zombie lending, suggesting that an ineffective resolution exacerbates credit misallocation. Recognizing the hidden NPLs implies the total NPLs in China is two to three times the reported amount. This paper was accepted by Victoria Ivashina, finance. Funding: B. Charoenwong acknowledges financial support from the Singapore Ministry of Education [AcRF Tier 1 Research Grant A-8000760-00-00]. T. Ruan acknowledges financial support from the National University of Singapore (NUS) [Start-Up Grant A-0003870-00-00]. B. Charoenwong and T. Ruan acknowledge financial support from the NUS Business School Financial Database [Grant N-311-000-251-001]. Supplemental Material: The online appendix and data files are available at https://doi.org/10.1287/mnsc.2022.02163 .

Indentured: Benefit deductions, debt recovery and welfare disciplining

AbstractThe UK social security system performs an important role as a creditor and debt collector for many benefit claimants, with more affected by deductions than formal welfare conditionality or sanctions. Deductions, then, are central to understanding low‐income life in the UK. With that in mind, this paper draws on a mixed‐methods project to explore the policy rationale, administration and effects of benefit deductions at a particular moment of crisis. Through new analysis of statistical releases, I evidence increasing indebtedness and an Inverse Care Law, whereby UK social security performs worst for those who need it most. Drawing on qualitative longitudinal ethnographic fieldwork conducted at the height of the cost‐of‐living crisis, I also evidence how deductions affect the lives and trajectories of low‐income claimants over time. The analysis offered details how deductions weaponize debt, often in ways that financialise benefit claimants and their entitlements that prove counter‐productive to the stated policy objectives of deductions: worsening the poverty‐debt trap and pushing people (further) away from the labour market.

Enforcing payment obligations under construction contracts by insolvency proceedings

PurposeStates have intervened with legislation to improve cashflow within construction project supply chains. The operation of the UK’s Housing Grants, Construction and Regeneration Act 1996 leads to payment obligations stated either as a contract administrator’s certificate (or equivalent) or an adjudicator’s decision. The purpose of the intervention would be defeated unless there are speedy ways of transforming these pieces of paper into real money. The combination of the legislation, contractual provisions and insolvency law has produced a minefield of complexity concerning enforcement of payment obligations stated in these documents. Unfortunately, the knowledge and understanding required to navigate these complexities have been sorely lacking. The purpose of this paper is to plug this gap.Design/methodology/approachLegal research methods and case study approaches, using relevant court decisions as data, were adopted.FindingsThe enforcement method advised by the court is the summary judgment procedure provided under the Civil Procedure Rules. An overdue payment obligation, either under the terms of a construction contract or an adjudicator’s decision, amounts to a debt that can be the subject of insolvency proceedings. Although the insolvency enforcement method has been successfully used on some occasions, using it purely as a debt collection weapon would be inappropriate and likely to be punished by the court.Originality/valueThe paper contributes to knowledge in two ways: (i) it maps out the factual situations in which these payment challenges arise in language accessible to the construction industry’s professions; and (ii) comparative analysis of payment enforcement methods to aid decision-making by parties to construction industry contracts. It is relevant to the other common-law jurisdictions in which similar statutory interventions have been made.

A New Formulation of Interest-Bearing Capital and Debt: A Marxian Perspective on the Circuit of Capital

This article refines the analysis of interest-bearing capital and debt in Marx’s circuit of capital, incorporating Kōzō Uno’s critique for a more precise depiction. It reassesses Marx’s model of interest-bearing capital () and Uno’s distinction between creditor and debtor roles, proposing an advanced model that highlights the role of financial instruments () and debt (). The form of money-lending capital for the creditor is articulated as , where represents the issuance of a loan and the collection of debt. On the other hand, the form of merchant capital with debt for the debtor is depicted as , incorporating both the borrowing () and repayment () processes within the form of merchant capital. This approach not only clarifies the transactions between creditors and debtors but also builds upon Uno’s theoretical contributions, offering a comprehensive framework for understanding the dynamics of interest-bearing capital and the movement of capital with debt. The revision aims to elucidate the processes of loan issuance, debt collection, borrowing, and repayment, rectifying previous conceptual oversights and offering a solid foundation for future economic research.

Redesigning tax debt collection process in Brazil: process automation & nudging for tax compliance

Propósito: Este estudio tiene como objetivo contribuir al conocimiento sobre el problema del cumplimiento tributario en Brasil al probar si Business Process Management (BPM) y el Nudge pueden ayudar a mejorar la recaudación de la deuda tributaria. El objetivo es evaluar si este enfoque mixto es efectivo y si puede implementar una transformación duradera en la administración tributaria brasileña.Diseño/metodología/enfoque: Este artículo presenta un estudio de caso orientado a la práctica que utiliza la metodología Business Process Transformation (BPT) para rediseñar y automatizar un proceso de cobro de deudas tributarias aplicando los conocimientos de la teoría del Nudge y luego prueba su efectividad usando experimentación controlada o prueba A/B.Hallazgos: al personalizar los parámetros para la mensajería automatizada con los contribuyentes en función del diseño de comportamiento y las pruebas A/B de los grupos, los autores pudieron identificar un aumento del comportamiento de cumplimiento del 2,90 % junto con un aumento de ingresos estimado de U$ 4 millones (P = 0,01). La evaluación posterior mostró que las nuevas prácticas eran duraderas, lo que indicaba el éxito de los métodos adoptados.Originalidad/valor: este estudio agrega nuevos conocimientos sobre la efectividad de BPT para la administración tributaria brasileña, reafirma cómo el Nudge puede apoyar el cumplimiento tributario en este contexto y ofrece información sobre la combinación de estos diferentes campos de conocimiento.