Can games help people who have a lot of bad debt get back on track? Encore Capital and Payoff.com will find out.

Encore Capital, which purchases consumer debt, is partnering with Payoff.com, a personalized finance motivation company, to provide elements of gaming and goal setting to help distressed consumers improve their financial health. The partnership brings together the efforts of a number of entities that purchase, collect and study consumer debt.

Payoff.com aims to make personal finance social and "fun" through rewards and goal setting that help consumers view their finances differently, and in a way that's designed to change behaviors. Encore Capital Group (ECPG) provides debt management and recovery solutions for consumers and property owners. It purchases portfolios of consumer debt from banks, credit unions and utilities — and partners with consumers as they repay. Through a subsidiary, Propel Financial Services, Encore assists property owners who are delinquent on property taxes by structuring payment plans. Encore has also created the Consumer Credit Research Institute, a collaboration with academia that uses tools from psychology, economics and neuroscience to study how consumers make financial decisions.

"We need to do a couple of things. One is we really need to learn more about the financially distressed consumer. Two, we benefit long term by aligning ourselves with the recovery of that consumer," says Brian Enneking, vice president of consumer marketing at Encore Capital Group. Encore is one of the country's largest debt recovery companies. It owns more than 40 million accounts; one in nine consumers in the U.S. has an account that's owned by Encore.

Payoff.com's free web site lets consumers view their personal balance sheets in a single location, by linking to financial accounts and tracking spending, similar to a personal financial management site. Users set up personal financial goals, and through data visualization, motivational strategies and rewards the site helps consumers progress toward paying down debts. There's a social component that lets consumers engage with each other. Payoff.com delivers its tools as software as a service, and the institutional client pays the company based on consumers who sign up and use the service.

The company also has relationships with more than two dozen servicers, which helps the site accrue and aggregate data. "What I learned from the financial train wreck of the past few years is that financial institutions have to deliver empowerment that helps consumers…financial institutions spend a lot of time looking at creditworthiness and scores based on past behavior. But the day after loans are made, there's very little done to nurture the right behaviors," says Scott Saunders, CEO and founder of Payoff.com.

By using some elements of game theory, Payoff hopes to engage consumers more in paying bills, rather than make the process seem punitive and adversarial. Debt collection companies sense that awkwardness, and are starting to embrace gamification, to train collectors and to take the edge off of a difficult process.

"Picture what debt collection looks like today. Collectors buy debt at seven cents on the dollar and send people letters and make phone calls…[it's better] to show up with a willingness to know what people been through and where they are. By measuring goals, people can get to where they are going more quickly and less painfully than they would otherwise," Saunders says.

The partners are also hoping to learn more about how people prioritize and pay bills.

"With Payoff we're testing in a controlled way, the kinds of goals that are good for people," says Christopher Trepel, chief scientific officer for Encore and managing director of the Consumer Credit Research Institute.

Trepel says there's not a lot of information available on distressed personal debt. "Ask about  high net worth individuals, and a bank will give you a ton of reports and books. But if you want to know about distressed consumers, there's almost nothing that people can provide."