The Bankwatch

Tracking the consumer evolution of financial services

The state of US bill payment channels | Aite

Aite Group have a new report on bill payment co-authored by Ron Shevlin. While the headline is regarding the expected uptick in mobile payments, some other numbers caught my eye.

How Americans Pay Their Bills: Sizing and Forecasting Bill Pay Channels and Methods, 2010-2013 | Aite

“There’s an emerging segment of consumers—which we call Smartphonatics—that will lead to an increase in the use of the online and mobile channels for paying bills,” says Ron Shevlin, senior analyst with Aite Group and co-author of this report. “These young and affluent consumers are chomping at the bit to use their smartphones, and are very likely to change how they pay bills if it becomes easier to do so via mobile. The growth of biller-direct over consolidator, coupled with the projected growth in mobile payments, means an opportunity for bill pay solutions providers to create an industry-leading mobile platform.”

The summary indicates that 33% of bill payments are made by cheque and mail, with 23% made online. Its not clear from this summary where the remaining 44% are made but I assume that is direct debit to a bank account or at ATM. What surprised me is the 33% number. Somehow I assumed the percentage paid by cheque was still higher than 33%. If we are down to that number one would think there must be a way to encourage that group down to almost zero very quickly.

Written by Colin Henderson

October 28, 2010 at 11:19

Posted in Uncategorized

2 Responses

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  1. Colin, thanks for citing the report. If I may, allow me to clarify a few data points. The press release reads:

    “Checks sent through the mail remain the most prevalent method for paying bills in the United States. The number of bill payments made through the mail will account for about one-third of all payments made, whereas payments made at a biller site—including recurring and mobile payments—will account for 23% of all bills paid in 2010.”

    In an attempt to not give away too much detail in the press release, that statements above refer to both payment channels (mail, online, etc.) as well as payment methods (check, direct debit, etc.).

    The statement that “checks sent through the mail remain the most prevalent method for paying bills in the US” is true, but that does NOT mean that checks represent just one-third of all payments. In fact the percent of bills paid by check is higher than that — some people pay by check in-person, for example.

    All told, we sized and forecasted bill payments for 7 different payment methods in 10 different payment channels.

    Hope this helps a little.

    Ron Shevlin

    October 28, 2010 at 14:49

  2. Thanks for the clarifications Ron and the interesting tidbits.

    Colin Henderson

    October 29, 2010 at 22:07


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