A recent study of billers across the United States reveals while a majority of consumers prefer ACH for bill pay when offered the option, there remains a rich opportunity for billers to migrate paper checks to electronic payments.
The study found that the great majority of billers – more than three-quarters of those that offer electronic payment options – offer Direct Payment via ACH, and now, almost 50 percent of consumer bills are paid through this method. Forty-two percent of consumer bills are still paid through the mail, and 11 percent are paid with credit/debit cards.
The findings illustrate one of the hidden problems in a highly developed electronic payment market such as the United States: consumer education can still move the needle, something many stakeholders often forget.
For example, the NACHA study found that the most successful billers with highest rates of Direct Payment adoption have a defined budget for promoting ACH, and have had success in increasing Direct Payment coupled with paper statement suppression campaigns. These billers also actively communicate with customers about Direct Payment options during service onboarding.
We have seen this problem with lack of consumer education in the contactless card segment, where issuers put these cards in consumers’ hands with little additional information and follow-up communications. Our work with consumers also indicates that this is true for the GPR card market as consumers use the cards once without understanding or knowing how or where they can reload them.
This study points out some key best practices, such as better leveraging the onboarding process where a company has consumers’ attention and then persistently promoting the capability whenever there’s a touchpoint. For something like billing, where there is often an ongoing communication flow, adding banners, messages, or occasional inserts is cost-effective and can improve participation, according to the study.
Click here to read more from NACHA.