It's Not Just About Paying Bills

May  08 
Justin Jackson  Vice President of Product Management, Electronic Payments, Fiserv 

Consumers want intuitive guidance and support to enhance financial health

Consumers are migrating from the traditional pen-and-paper mechanisms of the past toward digital solutions for day-to-day management of their financial lives. New research from Fiserv shows online payment activities are on the rise, including online bill pay, electronic bills and mobile banking.  

The most recent consumer trends survey from Fiserv found 65 percent of those who use a checking account to pay bills or make purchases have used online bill pay in the past 30 days, up from 59 percent last year. Using the same parameters, 58 percent used electronic bills and 47 percent used mobile banking, both increasing 5 percent year-over-year, according to the Expectations & Experiences survey conducted by The Harris Poll.

Is there still room for growth? Absolutely. Look for continued, measured increases as we approach what I believe will be 100 percent use of online and mobile bill pay in the coming years, especially for financial organizations that deliver a convenient, intuitive and personalized digital experience. 

At 53 percent, convenience is the leading reason for using online and mobile bill pay. Other top reasons include saving money and time compared to paying bills by mail (42 percent) and reducing paper and clutter (38 percent). 

But I would argue consumers are looking for more. If you'd have asked people 15 years ago why they use a cellphone, they would have said convenience. They wouldn't have said they needed a mobile device to access their music, watch a Netflix movie or have ready access to GPS. That's because those capabilities didn't exist. 

I believe we're at the same point with digital financial services. People are not only looking for convenience, but also intuitive guidance and support to enhance how they live their lives. 

We need to stop talking to consumers about online or mobile banking and start talking to them about their lives and their finances.  Show them how next-generation capabilities can help them meet their needs and achieve their goals. It's not just about paying bills. Together with other payment and financial management capabilities, it's about creating a deeper level of engagement to improve satisfaction and retention.

We need to stop talking to consumers about online or mobile banking and start talking to them about their lives and their finances.

It starts with giving consumers what they want – an intelligent, seamless and consistent digital bill payments experience. Here are three ways financial institutions can meet those expectations.  

1. Personalize the Bill Payment Experience

Financial institutions have deep data about consumers and their finances. Your organization can leverage that data to improve the billing experience by building out connections to systems and automating some of the services. It's about being more intuitive and providing answers about bills that need to be paid rather than relying on a "you tell us" approach. 

Data is key to creating differentiated and engaging experiences. Using the data already available to your organization, advise consumers about what they need to do and caution them about problems they may run into. Are they at risk of missing an upcoming payment? Is there a scheduled payment that will cause a potential overdraft? 

Make it easy for consumers to do what they need to do and get where they need to go. Always be teaching, reminding, advising and anticipating.  

2. Be the Advisor

Paying bills is a small piece of a broader, more comprehensive need to manage money in anticipation of achieving the goals people have for their lives – saving for college, paying off a car, improving credit to qualify for a mortgage. It's all about cash-flow management and gaining greater visibility to a full financial picture. 

Financial institutions can be that advisor. The need is real: 78 percent of Americans say they live paycheck to paycheck, and 38 percent of consumers – and half of millennials – say it would be difficult or impossible to pay back a $500 loan if they had to do so today. No one wants to live that way, but they may not know the way out of their financial circumstances. 

It's not a daily latte that's tripping up people who are struggling financially. Instead, they may have trouble budgeting for future expenses, saving for emergencies or earmarking money as it's coming in for bills that are due later in the month. 

Financial institutions have access to information about direct deposits, incoming and outgoing bills, transfers and even balances in retirement accounts. Using that unique visibility into consumers' lives, financial institutions can coach people to better manage their money. Organizations that can help people manage their finances at that level will build trust and strengthen relationships. 

3. Automate the Experience

Automatic payments are becoming the norm. In 2018, Fiserv found 51 percent of households made an automatic, recurring online payment in the past 30 days, up from 45 percent in 2017. 

Look for those numbers to trend upward, especially for financial institutions that focus on making bill payment even easier and more personalized. People are used to providers such as Amazon anticipating the next step and offering to automate the process. Data enables those experiences – easy, intuitive, hassle-free – in financial services by matching billers to payments, suggesting better ways to pay and providing real-time information about payments. 

Make it easy for consumers to do what they need to do and get where they need to go. Always be teaching, reminding, advising and anticipating.

Leveraging real-time data and automation, your financial institution can send notifications, reminders and financial information the moment something happens, giving people the information they need to take immediate action. The more you can simplify financial routines and provide reassurance that their needs will be met, the more your organization will become an active advisor in people's lives. 

An Intelligent Bill Pay Experience

People want their bank or credit union to help them meet their financial management and payment needs. How that happens will change with the advent of new technologies. 

People are already turning to innovations such as voice and speech recognition for authentication and easy login to their accounts. All-in-one devices link location with payment data. Disney's MagicBand wristband, for example, stores park tickets, ride reservations and payment information to create a seamless, personalized vacation experience. Google innovations include automatically scanning Gmail messages for notices about package deliveries, flight times, restaurant invitations and bill reminders and then using that information to send alerts and notifications. 

Innovations that take similar advantage of consumer information are quickly making their way into financial services. Using a data-driven approach, financial institutions can create profound, differentiated and engaging digital experiences that have a positive effect on financial health and wellness.