Consumers, Executives Align on Bill Payment Pain Points

Frustration with friction-laden bill payment processes has hit a new high for customers and executives.

The study “One-Stop Bill Pay Playbook: Executive Views on Third-Party Bill Payment Solutions,” a PYMNTS and Mastercard collaboration, found that 30% of bill payment execs are merely somewhat satisfied with their organizations’ billing capabilities. That number rises for smaller firms, where 44% of organizations with annual revenue under $100 million reported the same sentiment.

For firms of all sizes, the biggest pain points were manual reconciliation and automatic payments being declined due to bad card credentials. Rounding out the top three were service calls from customers misunderstanding their bills.

For consumers surveyed in PYMNTS’ Streamlining Bill Payment report, complaints about bill pay friction were more spread across multiple pain points.

These problems could easily manifest into customer dissatisfaction, as consumers across all sectors overwhelmingly demand convenience in transactions. This is especially true for the bill payments space. Forty-one percent of consumers cited ease and convenience as the most important factors for choosing a digital channel to pay recurring bills. The runner-up among the motivators for choosing a digital payment channel was faster payments, with 23% of consumers viewing this as most important.

Perhaps most concerning for billing execs is that consumers may be willing to switch providers if their expectations for a more frictionless experience are not met. Among consumers who were highly interested in an improved billing experience, over 44% said they would switch insurance providers if a competitor offered a better system, and 48% said the same for their auto loan providers.

Adding to the pressure for execs is the sentiment that consumers do not want to pay for improved service. This reluctance was especially true for those in high income brackets, where 59% of consumers earning above $100,000 annually expected an improved billing offering without added fees.

Some organizations with the motivation and means to innovate their bill pay methods are turning to one-stop solutions. Seventy-four percent of billing executives showed interest in offering customers access to a unified bill payment platform. This included firms that already offer some type of third-party digital billing portal. Recognizing the importance of customer loyalty, 35% of respondents cited convenience as the top reason for implementing these changes. Other reasons cited were increased payment channel options and payment reminders and/or confirmations.

Consumers and execs overwhelmingly agreed when it comes to the importance of alleviating bill payment friction. For firms involved in bill pay, the prospect of upgrading platforms may no longer be an option, but a necessity to stay competitive.