Russia’s largest bank hires debt collectors
With its conservative approach, Sberbank was the last big bank in Russia to rely exclusively on in-house collectors. But it’s made a decision to look for outside help in chasing its debts
Russia’s top debt-collection agencies will be competing for a slice of the action as the country’s largest bank begins outsourcing the business of handling customers who default.
Although no one from the bank would comment, market players say the move would fit with Sberbank’s cost-cutting strategy. Aleksey Kozyrev, Deputy Head of the Sequoia agency, said outsourcing the job to collecting agencies allows a bank to pay if and when the money is collected.
“When a bank works with troubled borrowers using its own resources, it always risks spending time and money in vain,” he said.
Sberbank’s default level is about 1 per cent of its loan book compared with an average of about 2 per cent in the broader Russian market. But that figure is likely to grow with the introduction of new bank products, prompting the bank to find more efficient ways to recover bad debt.
If the country’s largest retail lender hires debt collectors, some experts say the debt-collecting market could double over the next few years.