In fact, they are fast emerging as a “super power” that benefits consumers and credit unions alike, Sanjay Gupta, executive vice president of digital payments at ACI Worldwide, and Sumeet Bhalla, senior vice president of consumer banking at PenFed Credit Union, told Karen Webster.
That super power comes through a strengthening of relationships between the parties and in making sure that the bills are, in fact, paid on time.
As for just how often we’re wielding wallets to keep the lights on, the mortgage paid, the credit card current: Joint research from PYMNTS and ACI found that that consumers use mobile wallets at least 73% more often to pay bills and send money to others than they do to make in-store purchases.
Bill pay is the most widely used mobile wallet feature, with 50% of consumers having used mobile wallets to pay bills in the last 12 months. Consumers use bill pay an average of six to seven days a month, and 51% consider it an extremely important feature of mobile wallets.
Convenience, chimed in Bhalla, is and will continue to be a key determinant in driving bill pay. As it stands now, even done digitally, bill pay has been full of pain points and friction.
“Logging into web sites, keeping tabs on all the billers can be inconvenient,” he said. Remembering scores of passwords is a challenge at best, and a headache and frustration at worst.
“Many times when people are late with their payments, it’s not because they don’t have the ability to pay — it’s because they don’t have time, or they cannot log in,” Bhalla explained. In short, they’re not able to go through the process of making those payments.
“But having a centralized place where one can make payments, well, something that our members want and would like to use,” he added.
For credit unions, Bhalla said that giving members access to the mobile bill pay channel is becoming an essential “need to have” to keep members engaged and loyal. He noted that 80% of PenFed’s business is done through digital channels. Younger consumers — millennials and Generation Z among them — expect to have a digital experience that includes seamless bill pay.
It makes sense that the mobile wallet should be a go-to for consumers to pay bills, Gupta said. For one thing, the mobile device has become ubiquitous, and we’ve all got them on our physical persons pretty much all the time. The pandemic has ushered in a familiarity and comfort with using the mobile wallet and contactless features for payments.
Gupta said the always-on, always-there nature of the device — and by extension, the digital wallet — leads to the convenience that Bhalla noted is so prized by credit unions’ customers.
“Now, as opposed to calling in and waiting [to a provider]or getting to the PC and logging in to get the bill and pay it, you can just make the payment from the phone and ensure that things are done on time,” Gupta said.
Empowerment Through Immediate Confirmation
From ACI’s vantage point of working with a number of billers, credit unions and larger FIs, he said that the “super power” of bill pay comes as relationships are forged and reinforced on a daily basis.
“For the consumer using digital wallets to pay bills, it’s an opportunity to engage with the credit union or bank or utility company — and in the process, pay your bills,” Gupta noted.
The speed and convenience of being able to pay those bills on the fly come with a perk. Though payments are not instant, they are credited and confirmed, which makes consumers feel empowered, he explained.
“I’ve got peace of mind, and I know that I won’t ‘run late’ on my mortgage payment or electricity or gas payment or auto loan,” Gupta said. “There’s an immediacy that’s part of the psychology of the mobile channel.”
To promote that empowerment — and the evolution toward a one-stop functionality for consumers already using digital wallets — Gupta said that ACI’s moBills exist as a payments platform that offers a continuum of bill presentment, notification and payment options through SMS or other messaging. He noted that the platform also lets consumers set up personalized notifications — getting a reminder, for example, that a bill is due in three days.
Bhalla observed that the prompting, and the absence of the friction tied to logging into individual sites, can actually help improve delinquency rates at the FI (with its own loans in the mix) and providers.
Online bill presentment and payment also help, specifically with credit cards and utility bills, where consumers are loath to set up autopay due to their variable nature. Additionally, consumers want to review those charges before paying.
“Consumers want to see these bills — and watch what’s going on — and that’s part of this empowerment, too, that they’re sure this is the ‘right’ amount and they’re paying it down,” Gupta pointed out.
As consumers continue to use digital wallets beyond the point of sale, Bhalla said, there’s fertile ground for the CU to promote its own debit and credit cards as the “main card” to be used when members are making payments. Those cards and checking accounts can be digitally issued and provisioned to the digital wallet itself, he added.
Looking ahead, Bhalla said there’s still work to be done to make digital bill pay and presentment ubiquitous. He noted that 90% of merchants accept Apple Pay, but it took years to get there. Similarly, it will take time for merchants and other providers, banks and billers to embrace those digital conduits — in particular, digital wallets.
As Gupta told Webster, “at the institutional level — whether it’s a credit union, bank or any other biller — it all needs to be simple to adopt and integrate.” Consumers, increasingly, will need to be on board too.
“We’re getting close to the tipping point where the bill pay super power will truly take off for the benefit of the consumers, the credit unions, the banks and other billers,” Gupta said.