An executive at an American debt collection firm says callers from India are “very polite, very respectful.”

By HEATHER TIMMONS

GURGAON, India - In a glass tower on the outskirts of New Delhi, dozens of young Indians are on the telephone, calling America’s out of work, forgetful and debt-stricken and asking for cash.
“Are you sure that’s all you can afford-” one operator in a row of cubicles asks politely. “Well, how do you take care of your everyday ex penses?” presses another.
Americans are used to receiving calls from India for insurance claims and credit card sales. But debt collection represents a growing business for outsourcing companies, especially as the American economy slows and its consumers struggle to pay for their purchases.
Armed with a sophisticated automated system that dials tens of thousands of Americans every hour, and puts confidential information like Social Security numbers, addresses and credit history at operators’ fingertips, this new breed of collectors is chasing down late car payments, overdue credit card debt and lapsed installment loans. Debt collectors in India often cost about onequarter the price of their American counterparts, and are often better at the job, debt collection company executives say.
“India will be the only place we grow this year,” said J. Brandon Black, the chief executive of the Encore Capital Group, a debt collection company based in San Diego. India is the company’s largest operating area, with about half the company’s collection force of more than 300.
Although the stereotype of a collector may be “some guy with chains and a cut-off shirt,” Mr. Black said, collectors in India are “very polite, very respectful, and they don’t raise their voice.” He added, “People respond to that.”
Companies like Encore buy bad loans from banks and credit card issuers for pennies on the dollar and pocket the cash they collect.
So far just a tiny fraction, maybe 5 percent, of American debt collection is done outside the country, industry executives estimate. But new business is expected .
Just over 4.5 percent of all bank credit card accounts were delinquent in the fourth quarter of 2007, according to the Federal Reserve, up from 3.5 percent two years before. Businesses in the United States put $141 billion in delinquent consumer debt up for collection in 2005, according to a PriceWaterhouseCoopers survey.
Credit counselors in the United States say more and more of their clients are being contacted by debt collectors based in India. Sometimes it can cause problems. When clients “run into someone who doesn’t speak English well or there is a communication gap, it can add to the frustration of the customer,” said Bill Druliner, manager and financial counselor for GreenPath Debt Solutions in Milwaukee.
Debt collection, no matter who does it, can have “a devastating impact on people’s lives,” Mr. Druliner said. Still, he said, he had not run into any specific problems with overseas debt collectors. “What they may lack in authority or ability to handle slang, they do handle the process very well and are very well spoken,” he said.
Encore hires people with call center experience in India, then trains them in unexpected skills like sympathy. Clients “get very abusive, very emotional, very sad,” said Manu Rikhye, vice president at the Encore unit in Gurgaon. The collector’s job is to “try to empathize with the consumer,” he said, and try to figure out, if they’re angry, why. “Maybe it’s us, maybe it’s someone else,” he said. “You have to hear what they have to say.”