In my previous post, I wrote, "I have not uncovered sufficient...

In my previous post, I wrote, "I have not uncovered sufficient information to form a view on the ANZ supply of PDLs in FY23 and the year or two later. Credit card statistics, especially information on overdue payments is what I am yet to locate." After poking about, and getting nowhere, I decided that as I had assumed that ANZ is not going to be the geography that is going to do much for CCP in FY23, I may as well stick to waiting to see what Management announces over the year. The exercise was not fruitless, because I learned things about charge cards, credit cards (they are different, but I tended to conflate them) and BNPL.

On BNPL I found a good and detailed piece written by Jason Grotto of Bloomberg, dated 27 July 2022 at The Buy Now, Pay Later Juggernaut Is About to Be Tested. After reading that my view is that BNPL is a neutral shift as far as CCP is concerned, and if not neutral, it is positive. Most personal incomes are paid via deposit-taking institutions (DTIs), and for BNPL users, the money flows from there to pay BNPL commitments. DTIs are heavily regulated, so for years to come, the staid DTIs we well know, and from whom CCP buys PDLS, will rule the DTI roost. If BNPL users do not have the funds to meet BNPL payments, many will look to conventional alternatives - their DTIs, alternative lenders like Wallet Wizard, or skip paying their utility accounts. For CCP, not much may change, charged off bank and utility debt should not decline because of BNPL, IMO.

The debt-collection sector is in slow decline, and has been for over a decade, but the dominant companies like CCP, Encore, PRA and Intrum have grown at the expense of the smaller players. If debt leverage is considered a risk, CCP is the least risky of the global Big Boys.