In 2026, collections agencies face an unprecedented degree of complexity. As inventory tightens and margins shrink, compliance scrutiny grows. Consumer expectations continue to shift.

These pressures set the stage for our recent Horizon series Q1 webinar, where leaders discussed the broader transformation underway across the industry — specifically, how AI, automation, and integrated compliance capabilities are helping agencies adapt and compete more effectively.

If you missed the session, you can watch the webinar on demand here. Below are the key takeaways.

Agencies Are Being Squeezed from Every Direction

The collections environment is tightening across multiple fronts, with several forces shaping the market and putting pressure on agency performance.

• Creditors are retaining more accounts in-house, reducing placement volume for third-party agencies. The accounts that are placed are often more difficult to collect, requiring more time and effort to resolve. Recovery rates are expected to decline.
• Meanwhile, compliance risk is rising. Litigation is increasing, and regulatory expectations are evolving. These trends are contributing to a steady pattern of agency closures, reinforcing how quickly conditions are changing.

The imperative for agencies: improve performance, reduce operational drag, and manage risk more carefully with existing resources. Some agencies have achieved this balance, thanks to operational agility and the ability to leverage AI and automation effectively.

From Operational Friction to Competitive Advantage

As the market accelerates, operational friction becomes more visible. Processes that once worked effectively can slow decision-making and introduce risk.

Legacy workflows often rely on manual compliance checks, static queues, and disconnected tools. Over time, these inefficiencies compound, making it harder to adapt to regulatory changes, creditor expectations, and consumer behavior and demands.

Agencies that are pulling ahead share these characteristics:

• Technology that evolves continuously rather than requiring large upgrades
• Faster operational decision-making and testing cycles
• Business-level control over workflows and compliance logic
• Connected ecosystems that allow new capabilities to be introduced quickly

These combined advantages allow agencies to respond faster to change and maintain operational consistency at scale, regardless of external pressures.

“The point here isn’t that legacy systems are bad . . . but the world they were built for no longer exists. And evolution is required.” — Jamie Fernandes, Chief Product Officer, Finvi

AI Is Changing How Agencies Prioritize and Execute

AI is increasingly playing a central role in how agencies operate. In lieu of static work queues or manual prioritization, AI-driven systems evaluate accounts dynamically — even factoring in previously unusable unstructured data — and surface recommended actions.

These insights help determine:

• Which accounts to prioritize
• The best channel for outreach
• The optimal timing for engagement
• Which strategies are most likely to drive resolution

This AI-driven approach reduces guesswork and improves consistency across teams. Agents spend more time on accounts with higher potential, while managers gain better visibility into performance trends. Over time, these improvements contribute to stronger recovery performance and more efficient operations.

Automation Supports Scale and Reduces Risk

Automation is another critical piece of the evolving operating model, as manual processes are becoming harder to manage and more prone to error.

Workflow automation helps standardize processes, reduce variability, and improve execution speed. It also helps enforce compliance requirements and document actions automatically.
Having a more consistent operating environment allows agencies to scale more effectively. As volume increases, automation helps maintain performance without increasing staffing requirements.

Compliance Is Moving into the Workflow

Compliance continues to be a major concern for agencies. As regulatory expectations evolve, manual compliance processes become harder to manage at scale.

Today, there’s a shift toward embedding compliance directly into workflows. This includes automated rule enforcement, guided legal workflows, and structured documentation. These capabilities help ensure compliance requirements are addressed during execution. They also improve operational efficiency by reducing manual steps.

Measurable Impact Across Performance and Efficiency

AI and automation are already delivering measurable results for agencies. These improvements stem from three primary areas: recovery optimization, compliance and quality improvements, and operational efficiency.

• 15–25% improvement in recovery performance
• 50–70% reduction in QA costs
• 30–40% improvement in agent efficiency
• 20–30% increase in contact rates

These results show a clear shift in how work gets done. AI-driven prioritization improves recovery rates while automation streamlines quality, compliance, and outreach. The outcome is a more efficient operation that scales performance without increasing overhead.

“Velosidy uses AI to do three things exceptionally well: focus effort on the accounts, channels, and moments that matter most; reduce manual decision-making that slows teams down or introduces risk; and continuously learn from outcomes so performance improves over time.” — Jay Garmon, VP Product Management

A Practical Framework for AI Adoption

Rather than attempting to implement advanced capabilities all at once, agencies can adopt AI progressively through a structured framework.

This maturity model includes:

• Foundational rules and logic
• Predictive AI for prioritization and decisioning
• Deep learning capabilities such as speech analytics
• Generative AI for summaries and messaging
• End-to-end workflow automation

This layered approach allows agencies to build confidence and value over time. Many agencies begin with targeted use cases and expand adoption as they see measurable results.

Looking for a practical starting point? Download the AI in Collections Buyer’s Checklist — a quick guide to evaluating AI capabilities, governance, and compliance considerations before you commit.

Looking Ahead: AI at the Center of the Collections Journey

AI is expected to play an even larger role in orchestrating the collections journey, guiding decisions across the entire lifecycle. Connected ecosystems, improved consumer experiences, and expanded automation capabilities will continue shaping the future operating model. These trends point toward more intelligent, adaptive collections operations designed to help agencies navigate ongoing change.

Want to explore these insights in more detail? Watch the full Finvi Horizon Q1 webinar on demand.

See What AI-Powered Collections Could Unlock for Your Agency

Velosidy offers a modern approach designed to help you operate with greater speed, intelligence, and control. Schedule a conversation and see how AI, automation, and integrated compliance capabilities will leave you better positioned to compete — and how simple it is to get started.