New Study Attributes $1.6 Billion in Annual Consumer Savings to Debt Settlement Industry
WASHINGTON–(BUSINESS WIRE)–The American Fair Credit Council (AFCC), the national trade association representing the debt settlement industry, today released the findings from a first-of-its-kind analysis describing the industry’s national economic impact. The study, conducted by John Dunham & Associates, found that debt settlement services contributed a total economic impact of $4.9 billion to the U.S. economy in 2018.
“The results of this study highlight the critical importance of debt settlement for families seeking relief from crippling unsecured debt,” said AFCC President Robby Birnbaum. “In states where industry services are available, debt settlement delivers billions of dollars in savings and provides Americans facing a financial hardship with a proven path back to financial wellness.”
Debt settlement companies advocate on behalf of consumers in financial hardship by negotiating directly with their creditors to settle their debts for less than they owe, allowing these individuals and families to get back to living normal lives. The consumers aided by the industry settled more than 900,000 accounts in 2018 for a total of $1.6 billion in savings.
“Debt settlement truly helps consumers in need by offering a private sector alternative to bankruptcy. AFCC members help consumers make the best of a bad financial situation and – judging by these numbers – achieve outstanding results,” continued Birnbaum.
The study also found debt settlement services are vital to local economies. In 2018, the industry was responsible for nearly 28,000 jobs in the U.S. resulting in more than $659 million in local, state and federal taxes paid.
The report also outlines the added economic impact if consumers in the 18 states where, due to state-imposed regulatory or statutory restrictions, debt settlement is currently not widely available, had access to the service. John Dunham & Associates concluded allowing consumers in these states to access this service would drive an additional $1.4 billion in economic impact. The industry would also produce 9,170 more jobs and, most importantly, $422.4 million more in savings for indebted Americans.
For more information on the study, and the AFCC, visit AmericanFairCreditCouncil.org/study.
About the American Fair Credit Council
The American Fair Credit Council (AFCC) is the national association of professional Consumer Credit Advocates. The AFCC, and its member companies, work to represent the rights of consumers struggling with the overwhelming burden of debt. The AFCC has developed a strict Code of Conduct centered on best practices designed to protect the rights of consumers and require member companies to follow strict regulatory guidelines for operation. All AFCC members operate on a “No Advance Fee Model” and never charge a fee for services until a consumer’s debt has been successfully negotiated.