Indiana Collection Agency Manager
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1. Which of the following best describes the statutory authority
responsible for licensing collection agencies in Indiana?
A. Indiana Department of Insurance
B. Indiana Secretary of State, Securities Division
C. Indiana Department of Revenue
D. Indiana Attorney General’s Criminal Division
Answer: B. Indiana Secretary of State, Securities Division
Rationale: Indiana law assigns regulatory oversight of collection agency
licensing to the Secretary of State, which administers registration,
compliance, and enforcement of collection agency statutes under Title 25,
Article 11.
2. Under Indiana law, a “collection agency” is primarily defined as an
entity that:
A. Collects only court-ordered judgments
B. Engages in collecting or soliciting claims owed to another party
C. Purchases real estate debt portfolios only
D. Operates exclusively as a credit reporting bureau
,Answer: B. Engages in collecting or soliciting claims owed to another party
Rationale: Indiana law broadly defines a collection agency as any person
or business engaged in soliciting or collecting claims owed or asserted to
be owed to another entity.
3. Which requirement is mandatory for individuals who manage or
actively solicit accounts for a licensed collection agency in Indiana?
A. Must be licensed attorneys
B. Must be Indiana residents only
C. Must be U.S. citizens of good moral character and at least 18 years old
D. Must hold a degree in accounting
Answer: C. Must be U.S. citizens of good moral character and at least 18
years old
Rationale: Indiana law requires qualifying individuals to be at least 18, of
good moral character, and U.S. citizens to ensure fitness for licensure.
4. Which of the following disqualifies an applicant from holding a
collection agency manager role in Indiana?
A. Having a credit score below 700
B. Being under 21 years of age
C. Being a former licensee with a revoked license not reinstated
D. Working in another state’s collection industry
Answer: C. Being a former licensee with a revoked license not reinstated
Rationale: Indiana law explicitly bars individuals whose prior licenses were
revoked or suspended and not reinstated from qualifying for licensure
roles.
5. What financial requirement must Indiana collection agencies satisfy as
part of licensing?
A. A $50,000 cash deposit
B. A $5,000 surety bond per office
,C. A $10,000 insurance policy per employee
D. A $100,000 performance guarantee
Answer: B. A $5,000 surety bond per office
Rationale: Indiana requires collection agencies to maintain a surety bond
of $5,000 for each office as financial protection for clients and consumers.
6. Which document is typically required during the Indiana collection
agency license application process?
A. Federal tax return for the past 10 years
B. Electronic surety bond filed through NMLS
C. Personal bankruptcy discharge papers
D. Criminal indictment clearance certificate
Answer: B. Electronic surety bond filed through NMLS
Rationale: Applicants must submit a surety bond through the Nationwide
Multistate Licensing System (NMLS) as part of the licensing process.
7. What is the standard initial filing fee for an Indiana collection agency
license application?
A. $25
B. $50
C. $100
D. $500
Answer: C. $100
Rationale: Indiana law sets the non-refundable initial application fee at
$100 for collection agency licensing.
8. Which of the following is NOT excluded from the definition of a
collection agency in Indiana?
A. Attorneys
B. Banks and financial institutions
, C. Licensed real estate brokers
D. Independent debt buyers collecting purchased debt
Answer: D. Independent debt buyers collecting purchased debt
Rationale: Certain entities are exempt, but debt buyers collecting accounts
may still fall under regulation depending on activity and structure.
9. When does a collection agency license in Indiana expire?
A. Every 5 years
B. Every 3 years
C. Annually on December 31
D. Every 6 months
Answer: C. Annually on December 31
Rationale: Indiana collection agency licenses are issued on a yearly basis
and expire at the end of each calendar year.
10. Which of the following is required for nonresident collection
agency applicants in Indiana?
A. Indiana residency for all officers
B. Appointment of an in-state agent for service of process
C. A local Indiana tax exemption certificate
D. Federal FBI background clearance only
Answer: B. Appointment of an in-state agent for service of process
Rationale: Nonresident applicants must designate an Indiana-based agent
to accept legal service of process within the state.
11. The primary purpose of Indiana’s collection agency regulation is
to:
A. Increase state tax revenue
B. Protect consumers and ensure ethical debt collection practices
C. Eliminate all third-party debt collection
D. Promote banking expansion
Exam Practice Questions And Correct
Answers (Verified Answers) Plus
Rationale 2026 Q&A| Instant Download
1. Which of the following best describes the statutory authority
responsible for licensing collection agencies in Indiana?
A. Indiana Department of Insurance
B. Indiana Secretary of State, Securities Division
C. Indiana Department of Revenue
D. Indiana Attorney General’s Criminal Division
Answer: B. Indiana Secretary of State, Securities Division
Rationale: Indiana law assigns regulatory oversight of collection agency
licensing to the Secretary of State, which administers registration,
compliance, and enforcement of collection agency statutes under Title 25,
Article 11.
2. Under Indiana law, a “collection agency” is primarily defined as an
entity that:
A. Collects only court-ordered judgments
B. Engages in collecting or soliciting claims owed to another party
C. Purchases real estate debt portfolios only
D. Operates exclusively as a credit reporting bureau
,Answer: B. Engages in collecting or soliciting claims owed to another party
Rationale: Indiana law broadly defines a collection agency as any person
or business engaged in soliciting or collecting claims owed or asserted to
be owed to another entity.
3. Which requirement is mandatory for individuals who manage or
actively solicit accounts for a licensed collection agency in Indiana?
A. Must be licensed attorneys
B. Must be Indiana residents only
C. Must be U.S. citizens of good moral character and at least 18 years old
D. Must hold a degree in accounting
Answer: C. Must be U.S. citizens of good moral character and at least 18
years old
Rationale: Indiana law requires qualifying individuals to be at least 18, of
good moral character, and U.S. citizens to ensure fitness for licensure.
4. Which of the following disqualifies an applicant from holding a
collection agency manager role in Indiana?
A. Having a credit score below 700
B. Being under 21 years of age
C. Being a former licensee with a revoked license not reinstated
D. Working in another state’s collection industry
Answer: C. Being a former licensee with a revoked license not reinstated
Rationale: Indiana law explicitly bars individuals whose prior licenses were
revoked or suspended and not reinstated from qualifying for licensure
roles.
5. What financial requirement must Indiana collection agencies satisfy as
part of licensing?
A. A $50,000 cash deposit
B. A $5,000 surety bond per office
,C. A $10,000 insurance policy per employee
D. A $100,000 performance guarantee
Answer: B. A $5,000 surety bond per office
Rationale: Indiana requires collection agencies to maintain a surety bond
of $5,000 for each office as financial protection for clients and consumers.
6. Which document is typically required during the Indiana collection
agency license application process?
A. Federal tax return for the past 10 years
B. Electronic surety bond filed through NMLS
C. Personal bankruptcy discharge papers
D. Criminal indictment clearance certificate
Answer: B. Electronic surety bond filed through NMLS
Rationale: Applicants must submit a surety bond through the Nationwide
Multistate Licensing System (NMLS) as part of the licensing process.
7. What is the standard initial filing fee for an Indiana collection agency
license application?
A. $25
B. $50
C. $100
D. $500
Answer: C. $100
Rationale: Indiana law sets the non-refundable initial application fee at
$100 for collection agency licensing.
8. Which of the following is NOT excluded from the definition of a
collection agency in Indiana?
A. Attorneys
B. Banks and financial institutions
, C. Licensed real estate brokers
D. Independent debt buyers collecting purchased debt
Answer: D. Independent debt buyers collecting purchased debt
Rationale: Certain entities are exempt, but debt buyers collecting accounts
may still fall under regulation depending on activity and structure.
9. When does a collection agency license in Indiana expire?
A. Every 5 years
B. Every 3 years
C. Annually on December 31
D. Every 6 months
Answer: C. Annually on December 31
Rationale: Indiana collection agency licenses are issued on a yearly basis
and expire at the end of each calendar year.
10. Which of the following is required for nonresident collection
agency applicants in Indiana?
A. Indiana residency for all officers
B. Appointment of an in-state agent for service of process
C. A local Indiana tax exemption certificate
D. Federal FBI background clearance only
Answer: B. Appointment of an in-state agent for service of process
Rationale: Nonresident applicants must designate an Indiana-based agent
to accept legal service of process within the state.
11. The primary purpose of Indiana’s collection agency regulation is
to:
A. Increase state tax revenue
B. Protect consumers and ensure ethical debt collection practices
C. Eliminate all third-party debt collection
D. Promote banking expansion
