Technology

‘Gen Y’ Effect Drives Mobile Bill Payment

The number of bill payment users doubled from 2012 to 2013, survey shows.

December 25, 2013
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Generation Y consumers are increasingly responsible for paying bills and they prefer to use the mobile channel to manage their finances, according to Fiserv’s 2013 Billing Household Survey.

As a result, this growing demographic is influencing how billers are innovating based on their demands regarding specific bill payment preferences.

Mobile bill payment use doubled from eight million U.S. online households in 2012 to 16 million in 2013, the survey reports. This growth was driven primarily by smartphone owners, among whom mobile bill payment surged 150%.

Consumers who pay bills using their mobile device do so primarily for its convenience (70%), anytime access (55%) and time savings (49%).

It is important for billers to have mobile-optimized websites for bill payment as mobile-optimized financial institution and biller websites are the most popular choice when paying bills with a smartphone. However, apps for billers and financial institutions were also popular and grew rapidly.

The survey found that 83% of consumers use two or more channels to pay their bills each month. The average number of bill payment methods consumers use ticked up 10% from 2012 to 2013, rising to an average of 3.2 channels each month.

While the number of U.S. online households that pay a bill by check declined from 61% in 2012 to 53% in 2013, the number of households using mobile and tablet for bill payment gained ground, resulting in the higher number of channels used overall.

Many consumers continue to use established methods of paying bills, such as checks, phone, or in-person payments, and two-thirds believe billers should offer multiple ways to pay bills.

The Gen Y effect is evident here as 74% of Gen Y respondents consider offering multiple payment options important, compared to 67% of all respondents.

“While new bill payment channels such as mobile and tablet are coming on strong, traditional channels remain in use, creating a need for billers to support an ever-growing set of billing and payments, channels, and payment types,” says Jardon Bouska, Fiserv’s division president, biller solutions. “Americans—particularly Gen Y—are hungry for multiple options for digital bill presentment and payment.

Additional survey findings:
 Mobile-specific capabilities can drive digital bill payments. Fiserv’s survey found that the top motivator to pay bills or pay more bills using a smartphone is the use of an app and smartphone camera to take a picture of the bill, cited by 36% of respondents.

Using the camera to capture and then auto-populate bill payment fields streamlines the bill payment process. This finding reinforces the fact that consumers desire more engaging, simple, and quick user experiences facilitated by their mobile devices.

• Alerts and reminders can boost e-bill adoption. Actionable payment due alerts and reminders can help billers improve their reputation among consumers and increase the adoption of e-bills, which contain the same information as paper bills but are delivered online or to a mobile device.

Nearly 75% of households that expressed an interest in receiving alerts and reminders said they would have a more positive perception of a biller that sends them a reminder to pay a bill. Sixty-six percent said alerts and reminders would increase the likelihood they would use paperless e-bills, most likely because alerts help consumers overcome the concern of not having a paper bill to serve as a reminder to pay.

• Tablet use is growing. More than one in three tablet owners used their tablet to visit a biller site in the previous 30 days.

The primary reason for the visit was to pay a bill (63%), followed by accessing invoice information and history (36%). One in four tablet owners use the device to pay bills at either a biller or financial institution website, an increase of 19% over 2012.

The survey also found that 60% of tablet owners would like to receive e-bills on their tablet.

 Billing and payment drives website visits. More than 80% of consumers who visit a biller’s website do so to pay a bill, reinforcing the importance for billers to make billing and payment a prominent and strategic part of the site.

Seventy-one percent of consumers who use a biller site to make payments say that online accessibility has eliminated the need to call customer care. Billers that fail to provide an easy, direct, and clear way for consumers to find billing and payment information and options risk abandonment and the use of higher-cost channels to pay bills.

Click here to download the survey.

Eight ways for your financial institution to boost performance now

Williamoson
December 19, 2013 6:41 am
Great article, mobile banking is the next big thing and banks that get it right will be in a good position in the years to come. Banks will need to take adequate measures to ensure they have a secure and protected payments system. I work for McGladrey and there's a newsletter on our website with great information for banks on optimizing existing technology and other valuable insight into improving overall performance. @ ”Eight ways for your financial institution to boost performance now” http://bit.ly/1fBWe9u


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