SMS Regulations: Digital Communications for Debt Collection in the USA

New rules were implemented in the USA for digital debt collection communications. These rules affect how SMS messaging can be used by companies in the USA for debt collection notifications.
The Fair Debt Collection Practices Act of 2010 (FDCPA) has been adopted by the Federal Trade Commission (FTC). These regulations are called the Debt Collection Practices (Regulation of Oct 2020) and came into effect on 30 Nov 2021.
These rules are only applicable to SMS messages used to send debt collection communications to the USA.

  • A debt collector can be defined as someone who collects directly or indirectly a consumer’s debt or attempts to collect it.
  • To collect a debt, debt collectors may call the consumer or send them letters, emails, or SMS messages.
  • The debt collector communication applies per debt, not per consumer. There are no limitations on how often a debt collector may contact a consumer via email or text, but the frequency of messages can’t be abusive or harassing.
  • SMS notification from a debt collector must contain instructions for consumers to opt-out of further SMS communications.
  • If a consumer does not consent, debt collectors can’t contact them before 8 a.m. and after 9 p.m.
  • Consumers can send a letter to stop debt collectors from contacting them. A debt collector can get the consumer after receiving the letter to confirm that it will cease contacting them or if they intend to take other actions such as a lawsuit.
  • A debt collector must provide valid information to a consumer about the debt in communication. This information must include the amount of money owed, the name and contact details of the original creditor, and the steps to follow if the consumer doesn’t believe it to be their debt.
2. These rules for debt collection digital communications are specific to existing laws regulating SMS messaging commercially to protect consumers in the USA:
    • The telephone Consumer Protection Act of 1991 regulates telemarketing. It also establishes consumer protection measures to reduce unwanted commercial SMS messages. The TCPA requires explicit consent to receive SMS messages. Consumers can revoke their consent at any time. The TCPA’s rules for do not call are available.
    • Controlling the Assault of Nonsolicited Pornography, Marketing Act of 2003 (CANSPAM Act) applies the TCPA for unwanted mobile service commercial messages. This includes regulating SMS marketing communications by companies to consumers with whom they do not have a business relationship. This law stipulates that opt-out requests must be honored immediately.
3. The Cellular Telecommunications and Internet Association promotes industry best practices to help organizations comply with applicable laws regarding SMS messaging.
CTIA’s SMS Principles and Best practices give guidelines for running SMS campaigns in the USA according to the above laws TCPA, CAN-SPAM, and TCPA. This includes opting in processes to get written consent to receive SMS messages (section 5.1.2), opting out methods (section 5.1.3), as well as ensuring that message content follows best practices (section 5.3).
Disclaimer: This regulatory information does not constitute legal advice. Before you run any campaign, please consult your lawyer.

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