Ukraine Seeing a Growing Number of ARM Companies

As the financial environment becomes more favorable for consumers and small businesses in the Ukraine, industry players have found themselves launching new services, like collecting bad debts.

Until recently, banks managed their own bad debts.  However, Sequoia Credit Consolidation, one of the largest Russian collection agencies, is planning to open an office in Ukraine this month to take advantage of a potentially debt-lucrative environment.

(Goldman Sachs bought an undisclosed stake in the Russian collection agency in 2006.)

SCC spokesperson Svetlana Leonova hasn’t revealed a lot of detail about her company’s plans on the Ukrainian market, but has said her company is very interested.

Several Ukrainian collection agencies, though, could give SCC a run for its money.  Sluzhba Vykonannya Zobovyazan (SVZ), for example, is seeing an increased demand for its services as banks extend more credit to consumers.

Oleksiy Kushch, advisor to the president of the Association of Ukrainian Banks (AUB), said in an article running in the Kyiv Post that the amount of bad debt will continue growing because banks are placing fewer requirements on borrowers in an environment of tough competition on the market.