Usual Suspects Top ED Collection Contract for First Quarter

The two long term leaders on the U.S. Department of Education’s student loan collection contract were the top performers in the first quarter of this year, according to performance statistics released by ED last week.

Arcade, N.Y.-based Pioneer Credit Recovery was the largest money collector and total points winner among large collectors, bringing in $67.4 million in the quarter. The next-closest collection agency – Horsham, Pa.-based NCO Group – collected $50.7 million in the quarter.

The contract also has a provision for small businesses which currently has five agencies competing, compared to 12 for the large business, or unrestricted, contract. Fairport, N.Y.-based Continental Service Group was the largest performer among small businesses collecting $18.5 million over the first three months of 2008. Account Control Technology (ACT), based in Canoga Park, Calif., placed second for the quarter among small collectors with $16.7 million collected.

Over the 37 months the collection contract has been in force, the 17 collection agencies have brought in nearly $3.5 billion for ED. Pioneer, the company with the most money collected overall, has brought in $477.5 million alone.

The quarterly rankings and scores are used to determine bonuses and debt placement levels for subsequent periods.

ED will be filling a new collection contract in September of this year. The current one, awarded in 2004, expires in March 2009, with an option to extend it for six additional months as new contractors come on board ("ED to Extend Current Collection Contract for Only a Few," April 21).