Debt collection has existed since the inception of debt, predating the existence of money itself, as it emerged with ancient barter systems. Debt collection dates back to ancient civilizations, beginning in the summer of 3000 BC. During this period, if a creditor could not recover a debt, the debtor’s children or servants were forced into “debt bondage” until the creditor recovered their losses through compensatory labor or physical effort. Strict guidelines or measures governed debt collection under Babylonian law, including several basic debtor immunities. In some societies, debts were carried or passed on to subsequent generations, perpetuating debt bondage. However, some ancient societies provided periodic amnesties, such as the Jubilee, or set time limits for debt collection.
Both the Bible and the Quran provide strict instructions regarding interest on debt. The Abrahamic religions forbade lending and prohibited creditors from collecting interest on their outstanding debts. During the Middle Ages, laws specifically addressed debtors. If a creditor was unable to collect their debts, they could take the debtor to court and obtain a judgment against them. This resulted in bailiffs visiting the debtor’s home and collecting interest on the debt, or the debtor being sent to a debtor’s prison until the debtor’s family paid their debt or the creditor forgave them.
In areas occupied by the Roman Empire, tax collectors were often characterized by extortion, greed, and abuse in the name of power. In England, the catchpole was formerly an independent tax collector, but during the Middle Ages, he became legally responsible for debt collection, often using coercive methods. During the Great Depression of the 1930s, large financial institutions in the United States relied heavily on foreclosure to collect unpaid mortgage debts, which gained a very negative public image.