Fiserv 8th Annual Billing Household Study

© 2016 Fiserv, Inc. or its affiliates. 1

Annual Billing

Household Survey

Insights on Consumer Billing

and Payment Speed, Security

and Satisfaction

th


How

What

Where

do consumers receive and

pay their bills?

technologies, attitudes impact

consumer billing & payment behavior?

can billers improve customer

satisfaction and profitability?

Since 2008, Fiserv has sponsored the industry’s

most comprehensive survey to find out.


“Consumers expect everything at the speed of

life including receiving and paying bills. They

want it to be easy and now more than ever

before they want it safe and secure. Knowing

what customers want and where enables

Billers to optimize the increasingly strategic

billing and payment recurring touchpoint”

– Eric Leiserson,

Director of Research, Fiserv


In the past year

120 million

U.S. households

made 16 billion

bill payments


5%

12%

26% 27% 30%

Low Effort Low-MedEffort

Med Effort Med-HighEffort

HighEffort

Source: Eighth Annual Billing Household Survey, Fiserv Inc., 2016

Their #1 pain is the possibility

of late payments

The majority of consumers

expend medium-to-high effort in

receiving and paying bills


Bill Payment Channels Are

Fragmented Consumers have many options – new

ones emerge while established

methods continue. Either way, the

experience is hardly seamless.


2014

2.9 /month

2015

3.6 /month

Average Number of Payment

Methods Increased Dramatically

90% of

households use more than one payment method

1

2

3

4

5

6+

10%

23%

18%

18%

14%

15%

Today’s Consumers Adjust Their Payment Approaches to Suit Their Needs

40 percent increase from

the previous survey.

21 million households change how

they pay bills from one

month to the next.



Bill Pay Omnivores Expect More Options Than Ever


Online Biller Site

Check

Online FI Site

Mobile Browser, App or Text

Both Biller and FI Sites

Online Nonbanking Site

In Person Check Cashing Location

Phone Call to Biller

66%

50%

48%

33%

31%

25%

24%

13%

A Dramatic Increase in Use of Multiple Channels

Percent of Online Households Using Payment Method or

Funding Type Last Month



Not All Bills Are Treated The Same

Department Store

Auto Loan

School Loan

Natural Gas Water/Sewer

Insurance

Mortgage/Rent

Electricity

Internet Cell Phone Major Credit

Cable

Incidence

Pri

ori

ty

Top Priority Second Priority Third Priority

Consumer’s Bill Payment Priorities by Type and Regularity



The three new

of Billing and Payments

S Factors Speed Security Satisfaction


Speed Real-time options, including emergency payment options, are a must.

Security Consumers need to know they can trust their payments are secure.

Satisfaction A variety of ways to receive and pay bills leads to greater satisfaction.


Speed


The Need For Speed

70% of consumers

expect same-day credit

for bill payments.

That figure rises to

90% when considering

those who expect

credit no later than the

following day.

90% Next Day

70% Same Day Bill Pay


Credit


Expectations

of Faster

Processing

on the Rise

Same

Day

Next

Day

2-3

Days

Instantly

27% 43% 20% 9%

4%

15%

32%

49%

NotImportant

Neutral Important VeryImportant

-64% +59% +54% -31%

The Importance of Real-Time

and Same-Day Payment

Processing to Consumers



What’s behind the increase?

Only wanted to pay once

Registering takes too much time

Didn’t want another name and password

Didn’t want more email solicitations

48%

43%

36%

31%

In 2015, 26% Used Guest Check Out Option at Biller Sites to Pay Bills

One in four households reports

using the guest checkout option at biller sites due to convenience and password fatigue .



Need for Speed: Expedited Bill Payments

When thinking about receiving and paying

bills, the possibility of late payments is

consumers’ #1 concern. Nevertheless...

More than one-third of consumers paid a bill after the due date

in last 12 months and

65 percent had to pay a late fee.

Nearly half of those who paid a bill late

cited cash-flow difficulties.



Consumers Expect an Expedited

Payment Option Expedited bill payments

increase customer

satisfaction with the biller

65%

Almost 2/3 of consumers

expect billers to

offer emergency payments

59%



Security


Security Issues Weigh Heavily on People’s Minds

More than 27 million

people say they are more

concerned about security

than they were a year ago.



Concerns About Security

Have Increased

Thinking receiving and paying

household bills, which of the

following causes the most concern?

Consumer are most

concerned with…

Paying

Late

Security Paper

Clutter

Time

Spent

39%

26% 24%

19%

Rose from number 6 ranked last year to number 2



33%

Biller Direct and Bank Bill Pay Tied With Cards

Perceived As Most Secure

Consumers feel cards are the

most secure for paying bills

Credit , Debit,

Prepaid Cards 57%

Consumers feel these methods are

the most secure for paying bills

Banking

Bill Pay

Biller

Direct

Mail

Email

Non-

banking

Site

32%

2%

8%

25%


Checking ACH 43%

Its important Billers offer:

• 86% Credit/debit/prepaid cards

• 74% Checking ACH


Satisfaction


A variety of bill receipt and payment

options regardless of size

• Expedited bill payment options

• Mobile bill pay

• Paperless electronic bill

What Makes Customers

Happy


Consumers Expect Options

Regardless of Size of Biller

Do more options increase customer satisfaction? 71%

2015

43% 2014

Should small billers such as municipal providers offer the same billing and

payment options as large companies?

79% YES



Enabling Emergency Bill Payments through

Bank Bill Pay Likely to Enhance Satisfaction

With Billers

55% Increase

44% No Change

1% Decrease


Bill Pay


64% of consumers who

pay bills via mobile say it

increases their customer

satisfaction

Mobile Bill Pay Increases

Satisfaction

PAY



Percent of Mobile Bill Payers

Grew by 22% in 12 months Choosing to pay bills on a mobile phone is all about convenience



Mobile Bill Payment Transactions Are

Spread Across Multiple Channels



Mobile Bill Pay Is Growing Across the Board; By Income and Generation

Who pays bills with their

mobile phone year over year

Income <$50k

Income $50k- $99k

Income >$100k

40% 21%

56% 32%

39% 30%

Boomers Millennials GenX Seniors

10% 2%

18% 8%

42% 24%

60% 54%



Likelihood of consumers

switching to the competition

Receiving Electronic Bills Likely to Improve

Customer Satisfaction and Loyalty

Increased

satisfaction

66%

34%

No

Difference

66%

Increased

Satisfaction

Less Likely

More Likely

No Difference

36%

51%

13%



Consumers Receiving Both Paper And

Electronic Are Interested In Turning Off Paper

25% All Paperless 50%

Some

Paperless 25% All Paper

22% Not

Interested

27% Interested

25% Not Sure

26% Very Interested


Status Today E-bill interest level


Likelihood of consumers

switching to the competition

Viewing/Paying Bills at a Bank Site

Improves Customer Satisfaction and Loyalty

Increased

satisfaction

66%

34%

No

Difference

65%

Increased

Satisfaction

Less Likely

More Likely

No Difference

46% 50%

4%

Decreased

Satisfaction

1%



Paperless E-bill Adoption Rates

B IL L 16%

24%

26%

27%

28%

31%

32%

33%

36%

35%

43%

45%

Water/sewer

Natural gas

Electricity

Dept. store credit card

Mortgage

Major credit card

Insurance

Cable/satellite

Auto loan

ISP

School loan

Cell phone



Millennials

want to turn

off paper

Most open to

activating e-bills

when they

activate their

account

Most open to

activating e-bills

when they start

paying online

Prefer to set

up with

recurring

payment

Who to Target for E-bill and E-Payments

and When



Methodology: 8th Annual Billing Household Survey

In 2015, Fiserv Biller Solutions sponsored a replication of its annual

online survey

• The survey was completed by 3,021 respondents representative of

100M households using the internet

• Typical margin of error is +/-1.7% for percents based on 3000

respondents

• Will vary based on base size and percent

Survey was designed to provide the current view of the consumer

billing and payment marketplace

• Results compared to similar surveys sponsored by Fiserv to capture

ongoing and emerging trends


Consumer Billing and Payment Practices and

Preferences are Undergoing Dramatic Changes

• Speed, security and satisfaction

are dominating the bill pay

landscape

• Multiple easy, simple and fast

options are essential for bill pay

omnivores

• Growth expected in mobile and

card funded bill payments

• Opportunity exists to boost

paperless adoption at service set

up and among recurring bill

payees

Download our research paper on

fiserv.com/billers

Business

Fiserv 8th Annual Billing Household Study