Best Practices Boost Bill Pay Adoption

Many consumers lack awareness and understanding of CUs’ electronic bill-pay services.

October 21, 2013
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The use of electronic bill payment on credit union websites benefits both members and credit unions: The 2012 Fiserv Consumer Trends survey found that consumers who use electronic bill pay and electronic bills (e-bills) are more satisfied with their financial management processes and feel a greater sense of financial control.

And, there is a proven correlation between bill pay use and deeper member relationships: bill pay users have higher balances and lower attrition, and use more revenue-generating products than nonusers.

However, only 41% of online U.S. households reported using bill pay through their financial institution. Further, those that do use bill pay make less than 25% of their monthly payments through this service.

So why is consumer adoption and use of financial institution-based bill pay still relatively low? It seems that familiarity with existing routines and a pervasive lack of understanding about the availability and benefits of bill pay may be to blame.

From a consumer’s standpoint, the bill-pay process is a deeply ingrained and elaborate combination of paper and online processes spread across multiple physical and online locations. However, many consumers are dissatisfied with their routine.

While credit union-based bill pay can address this dissatisfaction by providing users with more control over the bill-payment process, consumers demonstrate a notable lack of awareness and understanding of the electronic billing and payment services offered by credit unions and how these services can help them.

Bill-pay adoption challenges

Several challenges impede consumer adoption and use of electronic bill payment. Fiserv consumer research identified three main hurdles that must be overcome to improve the bill payment experience and deepen these payment relationships:

1. Consumers are stuck in routines. A typical bill payment routine includes these steps: Review the bill when it arrives, put it in a queue to be paid (often in a stack of bills), pay the bill (using any number of electronic or physical methods), and record information about the date and method of payment on the bill and then file for future reference.

Elements of the routine play important roles, such as the stack of bills serving as a reminder to pay. Although many consumers may readily admit that their bill-payment process is less than ideal, they are reticent to change since they developed their own processes and have used those processes month after month.

The routine gives consumers a sense of accomplishment and assurance, so most consumers are not actively looking to change.

2. Lack of awareness and misperceptions. Some consumers still believe financial institutions charge for bill pay despite the fact that almost all offer free bill payment within online and mobile banking.

Consumers also express uncertainty around the reliability and speed of payment delivery, so they are hesitant to make their “important” bill payments through their financial institution.

And one-third of bill pay users don’t know if their financial institution offers the ability to receive e-bills within the bill payment service.

3. Fear and uncertainty. Change can be scary, especially if missteps such as a late payment can incur financial penalties or damage credit scores.

Members are unlikely to change their payment behaviors to include electronic bill payment, or more frequent use of electronic bill payment, unless they are confident that they understand how it works and feel that changing their bill-payment habits offers some advantages.

There are some best practices credit unions can employ to overcome these challenges and boost adoption.

NEXT: Bill pay best practices

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Great article! Unfortunately, most employees don’t feel valued or appreciated by their supervisors or employers. In fact, research has shown that the predominant reason team members quit their jobs is because they don’t feel valued. This is in spite of the fact that employee recognition programs have proliferated in the workplace – over 90% of all organizations in the U.S. has some form of employee recognition activities in place. But most employee recognition programs are viewed with skepticism and cynicism – because they aren’t viewed as being genuine in their communication of appreciation. Getting the “employee of the month” award, receiving a certificate of recognition, or a “Way to go, team!” email just don’t get the job done. How do you communicate authentic appreciation? We have found people have different ways that they want to be shown appreciation, and if you don’t communicate in the language of appreciation important to them, you essentially “miss the mark”. Additionally, employees need to receive recognition more than once a year at their performance review. Otherwise, they view the praise as “going through the motions”. A third component of authentic appreciation is that the communication has to be about them personally – not the department, not their group, but something they did. Finally, they have to believe that you mean what you say. How you treat them has to match the words you use. If you are not sure how your team members want to be shown appreciation, the Motivating By Appreciation Inventory ( will identify the language of appreciation and specific actions preferred by each employee. You then can create a group profile for your team, so everyone knows how to encourage one another. Remember, employees want to know that they are valued for what they contribute to the success of the organization. And communicating authentic appreciation in the ways they desire it can make the difference between keeping your quality team members or having a negative work environment that everyone wants to leave. Paul White, Ph.D., is the co-author of The 5 Languages of Appreciation in the Workplace with Dr. Gary Chapman.

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