Debt Collectors Consider Text Messaging

There is no denying that text messaging is becoming a major medium for exchanging data. Fast, painless, no speaking on the phone. No wonder that according to the latest statistics that are available there were almost 750 billion text messages sent in the U.S. in 2009, nearly double the number from one year before. Actually, technology and research firm executive Jacob D. Almeida recently predicted that money transfers will be the number one mobile application by 2012.

Debt collectors have stayed out of this field for now; The Fair Debt Collection Practices Act was a landmark legislation that went into effect in the late 1970s and has strictly outlined how debt collectors can call and when. Seeing as this act is even older than a stereotypical "Saved by the Bell Cell phone" from the 90s, it might be due time to adjust the law. But analysts are saying that any change in this area would have to come from consumers seeking change, not collectors.

Under the FDCPA, communications with consumers need a notice that the message is in fact from a debt collector, which leads to issues with the 160 character maximum length of money transferring texts. Another problem is figuring out who will pay the message. There is no current way for a collection firm to know if a consumer has a plan that includes unlimited text messages; the kicker being that if a contact is paid for by the debtor, it is illegal.

Another potential problem for debt collection agencies is determining the ownership of the device itself. The debtor might be utilizing a company owned wireless device for example. Said company might be monitoring the usage of the device, leading to third party disclosure issues if there were communications based in text regarding a debt.

Sadly, Congress has to vote on health care, the budget, cap and trade and many other issues first before it can get down and tackle this text message issue. So time will tell.