The Bill Pay Gender and Generation Wars
The Bill Pay Gender and Generation Wars Patrick Howard Sr. Director Product Management
PAYMENTS INNOVATION ALLIANCE MEETING OCTOBER 17-19, 2016
Not To Generalize…But…
2
© 2015 Fiserv, Inc. or its affiliates.
3
© 2015 Fiserv, Inc. or its affiliates.
“Sometimes a short walk down memory lane is all it takes to appreciate where you are today.”
4
© 2015 Fiserv, Inc. or its affiliates.
Remember these …
1980s
5
© 2015 Fiserv, Inc. or its affiliates.
2000
Today
Remember these …
1980s
6
© 2015 Fiserv, Inc. or its affiliates.
2000
Today
Massive Changes in Past 30 Years First 3d Chip 3D Movies Google Driverless Car iPad Facebook YouTube Google Hybrid Cars DVDs
Accelerating Growth in Technology (Condensed)
Cell Phones WWW Windows Apple Macintosh MS-DOS Word Processor Microprocessor
Man on the Moon
Telegraph
Telescope
Printing Press
Light Bulb
Steam Engine 1400
7
1450
1500
© 2015 Fiserv, Inc. or its affiliates.
1550
1600
1650
1700
1750
1800
1850
1900
Telephone
1950
2000
Car
2015
Fundamental Shift …. From Hierarchy Methodical Top Down Command & Control Centralized Information
8
© 2015 Fiserv, Inc. or its affiliates.
… to Network
“We are witnessing the greatest fundamental shift the world has seen in the way we organize, collaborate, connect and contribute since the industrial revolution. “
9
© 2015 Fiserv, Inc. or its affiliates.
AKA … The Internet of Things
“The pace of technological development is accelerating, creating new and unexpected customer interactions and expectations. Technologies that weren’t commonplace five years ago are now normal for an entire generation (e.g., Twitter, Snapchat, Yik Yak, Facebook Messenger, etc.).” – Aspect Consumer Experience Index 10
© 2015 Fiserv, Inc. or its affiliates.
So in this new environment,
how are consumer expectations evolving?
11
© 2015 Fiserv, Inc. or its affiliates.
First, Who Are We Dealing With?
Millennials 7.5 Bills/Month GenX 51 Million 9.6 Bills/Month
Boomers 75 Million 9.4 Bills/Month Source: First Data Whitepaper
12
© 2015 Fiserv, Inc. or its affiliates.
Source: 2013 FDIC National Survey of Unbanked and Underbanked Households , October 2014
Evolving Expectations … 1 of 6
I WANT IT TO BE FAST.
13
© 2015 Fiserv, Inc. or its affiliates.
Similar willingness to pay a small fee to receive funds from a check within various time frames Willingness to Pay a Small Fee to Receive Funds from Check Within…
Within a few seconds
15%
Within a few minutes
Within an hour
Within a few hours
Within the same day
Within a few days
19%
17%
Late Millennials are more likely to be willing to pay a fee for immediate access to funds within a certain time frame
15%
16%
13%
Base: All Qualified Respondents (respondents only saw one time frame) n=3064 Q1240-1245 If you received a check that you were not sure would clear, would you pay a small fee to guarantee that you received the funds from that check within…. 14
© 2015 Fiserv, Inc. or its affiliates.
Billers: Consumer Expectations Support Fast Payments and Real Time/Same Day Posting is Overwhelmingly Viewed as Important When you make Bill Payments at the biller’s website, when do you expect to receive credit for that payment? Instantly
23%
Same day
41%
Next day
24%
2-3 days
4+ days
How important is it that payments made to a biller are posted in real time or within the same day?
12%
1%
Source: Fiserv Insights: 2016 Consumer Billing Preferences Survey Base: Biller Direct Payers
Important 73% Not important 27%
Evolving Expectations … 2 of 6
I WANT IT NOW
16
© 2015 Fiserv, Inc. or its affiliates.
Likelihood of Late Payments and Expedited Bill Pay Usage
Millennials s
49% Paid Late 40%
Pay Late
37%
Twice as likely to
37%
Expedited
35%
Expedite Bill Payment through mobile app or browser from Financial Institution
28%
No Fee
30%
Source: Fiserv Insights: 2016 Consumer Billing Preferences Survey 17
© 2015 Fiserv, Inc. or its affiliates.
Consumers Overwhelmingly Interested in Receiving Reminders from Banks or Billers; Doing So Would Enhance Satisfaction Interest in receiving reminders that a bill is due to help avoid making a late payment?
No, 11%
If yes: what impact would that have on your satisfaction with that biller or bank?
More positive, 80%
Yes, 73%
Not sure, 16%
Yes, 73% If yes: Would reminders increase your likelihood of going paperless?
Not sure, 16%
Source: Fiserv Insights: 2016 Consumer Billing Preferences Survey
No, 11%
No differenc e, 19%
More negative, 1%
Evolving Expectations … 3 of 6
I WANT IT WHERE I WANT IT
19
© 2015 Fiserv, Inc. or its affiliates.
Top Items Consumers Can’t Leave Home Without
Millennials (48%) are more likely to say they couldn’t leave home without a debit card, while Late Boomers (39%) and Seniors (45%) point to a credit card.
60% phone
36% Debit Card
31% Credit Card
26% Cash
3% Checkbook
Base: All Qualified Respondents n=3064 Q705 If you could take only three items with you, what would be the item(s) that you can’t leave home without? Please select up to three responses. 20
© 2015 Fiserv, Inc. or its affiliates.
Adoption of Mobile Bill Pay Grew by 27%; Percent Using for Mobile Bill Pay Increased by 24%; Number of Bills Paid grew via Mobile grew by 75% Biller's mobile site 28%
% of US Online Households Paying at Least One Bill through Mobile Bill Pay
42%
Bank app 17%
33% 27% Biller app 18% 16% 8%
2012
Text 9%
2013
2014
2015
2016
Source: Fiserv Insights: 2016 Consumer Billing Preferences Survey
Other provider app 10%
Bank's mobile site 18%
Average number of bills paid using their mobile phone by mobile bill pay users went from 3.6 to 6.3 (75% increase)
Rapid Rise in the Percents of Low and High Income and Millennial through Boomer Generations Using Mobile Bill Pay Percent of Each Demographic Group Paying Bills with their Mobile Phone Largest gains
Largest gains 74%
52%
54%
51%
56%
40%
60%
Millennials are more likely to select mobile payments as the fastest (14%), most secure (7%), most convenient (13%), or preferred (9%) payment method, compared to their older counterparts.
51%
42%
39%
30%
18% 2015
2016
PAYMENTS INNOVATION ALLIANCE MEETING OCTOBER 17-19, 2016
Not To Generalize…But…
2
© 2015 Fiserv, Inc. or its affiliates.
3
© 2015 Fiserv, Inc. or its affiliates.
“Sometimes a short walk down memory lane is all it takes to appreciate where you are today.”
4
© 2015 Fiserv, Inc. or its affiliates.
Remember these …
1980s
5
© 2015 Fiserv, Inc. or its affiliates.
2000
Today
Remember these …
1980s
6
© 2015 Fiserv, Inc. or its affiliates.
2000
Today
Massive Changes in Past 30 Years First 3d Chip 3D Movies Google Driverless Car iPad Facebook YouTube Google Hybrid Cars DVDs
Accelerating Growth in Technology (Condensed)
Cell Phones WWW Windows Apple Macintosh MS-DOS Word Processor Microprocessor
Man on the Moon
Telegraph
Telescope
Printing Press
Light Bulb
Steam Engine 1400
7
1450
1500
© 2015 Fiserv, Inc. or its affiliates.
1550
1600
1650
1700
1750
1800
1850
1900
Telephone
1950
2000
Car
2015
Fundamental Shift …. From Hierarchy Methodical Top Down Command & Control Centralized Information
8
© 2015 Fiserv, Inc. or its affiliates.
… to Network
“We are witnessing the greatest fundamental shift the world has seen in the way we organize, collaborate, connect and contribute since the industrial revolution. “
9
© 2015 Fiserv, Inc. or its affiliates.
AKA … The Internet of Things
“The pace of technological development is accelerating, creating new and unexpected customer interactions and expectations. Technologies that weren’t commonplace five years ago are now normal for an entire generation (e.g., Twitter, Snapchat, Yik Yak, Facebook Messenger, etc.).” – Aspect Consumer Experience Index 10
© 2015 Fiserv, Inc. or its affiliates.
So in this new environment,
how are consumer expectations evolving?
11
© 2015 Fiserv, Inc. or its affiliates.
First, Who Are We Dealing With?
Millennials 7.5 Bills/Month GenX 51 Million 9.6 Bills/Month
Boomers 75 Million 9.4 Bills/Month Source: First Data Whitepaper
12
© 2015 Fiserv, Inc. or its affiliates.
Source: 2013 FDIC National Survey of Unbanked and Underbanked Households , October 2014
Evolving Expectations … 1 of 6
I WANT IT TO BE FAST.
13
© 2015 Fiserv, Inc. or its affiliates.
Similar willingness to pay a small fee to receive funds from a check within various time frames Willingness to Pay a Small Fee to Receive Funds from Check Within…
Within a few seconds
15%
Within a few minutes
Within an hour
Within a few hours
Within the same day
Within a few days
19%
17%
Late Millennials are more likely to be willing to pay a fee for immediate access to funds within a certain time frame
15%
16%
13%
Base: All Qualified Respondents (respondents only saw one time frame) n=3064 Q1240-1245 If you received a check that you were not sure would clear, would you pay a small fee to guarantee that you received the funds from that check within…. 14
© 2015 Fiserv, Inc. or its affiliates.
Billers: Consumer Expectations Support Fast Payments and Real Time/Same Day Posting is Overwhelmingly Viewed as Important When you make Bill Payments at the biller’s website, when do you expect to receive credit for that payment? Instantly
23%
Same day
41%
Next day
24%
2-3 days
4+ days
How important is it that payments made to a biller are posted in real time or within the same day?
12%
1%
Source: Fiserv Insights: 2016 Consumer Billing Preferences Survey Base: Biller Direct Payers
Important 73% Not important 27%
Evolving Expectations … 2 of 6
I WANT IT NOW
16
© 2015 Fiserv, Inc. or its affiliates.
Likelihood of Late Payments and Expedited Bill Pay Usage
Millennials s
49% Paid Late 40%
Pay Late
37%
Twice as likely to
37%
Expedited
35%
Expedite Bill Payment through mobile app or browser from Financial Institution
28%
No Fee
30%
Source: Fiserv Insights: 2016 Consumer Billing Preferences Survey 17
© 2015 Fiserv, Inc. or its affiliates.
Consumers Overwhelmingly Interested in Receiving Reminders from Banks or Billers; Doing So Would Enhance Satisfaction Interest in receiving reminders that a bill is due to help avoid making a late payment?
No, 11%
If yes: what impact would that have on your satisfaction with that biller or bank?
More positive, 80%
Yes, 73%
Not sure, 16%
Yes, 73% If yes: Would reminders increase your likelihood of going paperless?
Not sure, 16%
Source: Fiserv Insights: 2016 Consumer Billing Preferences Survey
No, 11%
No differenc e, 19%
More negative, 1%
Evolving Expectations … 3 of 6
I WANT IT WHERE I WANT IT
19
© 2015 Fiserv, Inc. or its affiliates.
Top Items Consumers Can’t Leave Home Without
Millennials (48%) are more likely to say they couldn’t leave home without a debit card, while Late Boomers (39%) and Seniors (45%) point to a credit card.
60% phone
36% Debit Card
31% Credit Card
26% Cash
3% Checkbook
Base: All Qualified Respondents n=3064 Q705 If you could take only three items with you, what would be the item(s) that you can’t leave home without? Please select up to three responses. 20
© 2015 Fiserv, Inc. or its affiliates.
Adoption of Mobile Bill Pay Grew by 27%; Percent Using for Mobile Bill Pay Increased by 24%; Number of Bills Paid grew via Mobile grew by 75% Biller's mobile site 28%
% of US Online Households Paying at Least One Bill through Mobile Bill Pay
42%
Bank app 17%
33% 27% Biller app 18% 16% 8%
2012
Text 9%
2013
2014
2015
2016
Source: Fiserv Insights: 2016 Consumer Billing Preferences Survey
Other provider app 10%
Bank's mobile site 18%
Average number of bills paid using their mobile phone by mobile bill pay users went from 3.6 to 6.3 (75% increase)
Rapid Rise in the Percents of Low and High Income and Millennial through Boomer Generations Using Mobile Bill Pay Percent of Each Demographic Group Paying Bills with their Mobile Phone Largest gains
Largest gains 74%
52%
54%
51%
56%
40%
60%
Millennials are more likely to select mobile payments as the fastest (14%), most secure (7%), most convenient (13%), or preferred (9%) payment method, compared to their older counterparts.
51%
42%
39%
30%
18% 2015
2016
