Mobile technology is transforming bill payment habits
The payments industry is rapidly transforming, with innovative apps and more alternative payment methods becoming available daily.
According to a recent survey by ACI Worldwide, consumers are adopting mobile payments at a faster rate than ever before, with 45% more payments made with a mobile wallet in 2022 than the previous year. Similarly, an Omdia survey found that technology spending in alternative payments is expected to significantly outpace traditional payments over the next 18 months as issuers and acquirers adapt to unprecedented demand for payments. digital, according to Omdia senior analyst Philip Benton.
The results indicate that if companies are not yet offering mobile payment options, they should make their implementation a priority to ensure they meet consumer expectations.
New habits and attitudes continue to emerge with the use of mobile wallets, signaling a “huge opportunity” for businesses to redouble their efforts to transform and modernize their billing experiences.
Sung Choi, vice president of business development at cryptocurrency exchange Coinme, notes that despite all the changes, billing experiences have remained essentially the same.
“The type of payment methods available tend to be limited, and the billing UI/UX is apparently stuck in the early 2000s,” he says.
From his perspective, the billing industry needs to innovate and modernize by incorporating innovations in payments with a more streamlined user interface and improved user experience through technologies such as Simple Account Linking (Plaid) and direct deposit redirection (Pinwheel).
“Companies can also help their customers by allowing them to pay with alternative assets such as cryptocurrencies,” he adds. “For example, PayPal has shown with its pay-with-cryptography feature that customers aren’t just looking to spend their balance in US dollars — customers want the ability to spend their digital assets.”
APMs are part of a mobile banking ecosystem
Choi adds that alternative payment methods (APMs) can have two major benefits in helping consumers, the first being that APMs can help individuals spend funds directly where they are rather than transferring funds to their account. banking.
“For example, if a person is paid in Venmo at the end of the month, and the rent is due on the 1st of the following month, it would be easier for them to pay with Venmo, rather than having to pay a fee for instantly transfer the money to their bank account to pay their rent,” he explains. “By meeting the client where they are, you could make it easier for them and help them save money.”
Second, Choi says APMs can help individuals make payments using alternative assets such as cryptocurrencies.
He points out that PayPal has shown with its crypto payment features that consumers are demanding the ability to pay with non-dollar assets.
“Whether it’s because customers need to spend their investments when cash flows are tight or because they want to spend their earned earnings, allowing consumers to use alternative assets can encourage lower default rates,” says -he.
Mobile bill payment stakeholders across the organization
Sanjay Gupta, billing segment manager for payment systems company ACI Worldwide, explains that billing and payments are more than just a way to collect revenue: it’s a recurring point of contact that businesses have with their customer base and that can also be used to go further. commitment and loyalty.
“Whatever the channel, consumers now expect a personalized billing and payment experience. Companies therefore need to find the right partner who can deliver these experiences, while integrating with their existing systems and processes,” he says.
When it comes to the adoption of mobile payment platforms and other FinTech decisions, Gupta says key stakeholders span a variety of business functions, often with different goals for each.
He points out that limited resources and ease of implementation are key for IT players, cost and ease of reconciliation are important for treasury and finance managers, while promoting self-service and guarantee of a positive experience are important for those who manage customer service.
“Educating the leadership team on how investments in providing a modern billing and payments experience benefits not only customers, but also employees, can help validate the need to make such investments,” says Gupta.
From his perspective, offering a variety of alternative payment methods ensures businesses meet the needs of a growing number of consumers who prefer or rely on these methods.
“While some consumers prefer to simply centralize their payments in a mobile wallet such as Apple Pay or Google Wallet, others may not have traditional bank accounts or traditional jobs, relying instead on methods like PayPal” , he said.
The integration of these alternative payment methods will increase consumer satisfaction and loyalty, especially for younger generations, and accelerate self-service payments, thereby reducing costs for the biller.
“We’ve been tracking the rise of mobile for several years,” says Gupta. “This year, the growing preference for not only making payments, but also storing non-paying items such as digital tickets and IDs in a mobile wallet came as a surprise. However, this all makes sense, as consumers are also reporting greater confidence in the security of mobile wallets, so they are using them more in their daily lives.
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