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Popularity of Electronic Payments Continues to Soar

 

Nov. 11 - Electronic payments continue to rapidly become the most preferred form of bill payment among consumers, according to a recent survey of more than 600 Texans by Dallas-based SWACHA, one of the largest not-for-profit electronic payment associations in the country. According to SWACHA’s 2013 Consumer Insights Survey, 88 percent of respondents reported they pay at least one bill electronically, up from 82 percent in 2009; and nearly half of those indicated they have increased their use of electronic payments compared to 12 months ago as payment method trends continue to shift from traditional paper checks to mobile and online platforms.

Not surprisingly, younger respondents reported embracing electronic payments at a higher percentage than those in older age categories, but not by much. Ninety-three percent of those aged 25 to 54 reported they pay at least one bill electronically, however older respondents were not far behind with 80 percent aged 55 and older stating they pay electronically.

“We encourage financial institutions to recognize that consumers are embracing electronic payments on a wide range of payment platforms and they need to be prepared to meet these needs,” said Dennis Simmons, AAP, President and CEO of SWACHA. “We will continue to work with those involved in the payments industry to ensure they provide a safe and secure environment for consumers to transact business as we continue our move to a paperless society.”

The increased use of electronic payments revealed in SWACHA’s survey has been concentrated in the payment of utilities and mortgages. Since 2009, 27 percent more respondents reported they pay their gas bills via electronic payments instead of checks, followed by 21 percent more who pay water bills, and 19 percent more of respondents who pay their mortgage electronically.

Benefits of electronic payments

Among the many benefits of electronic payments that respondents listed, SWACHA found that the majority (48 percent) reported that not having to write and mail checks is the single most important benefit. Not having to worry about missing deadlines was reported by 26 percent as the single mostimportant benefit followed by 11 percent who view saving paper and helping the environment as the single most important benefit. Not having to visit billers’ offices and having online receipts also were among the benefits cited as the most important by 9 percent and 3 percent respectively. It is important to note, however, that among the drawbacks of electronic payments cited in the survey, 35 percent agreed that having to change all the details when they move or change banks or credit cards was the most significant drawback.

“Changing banks or credit cards typically involves updating your information with each company, changing account numbers for direct deposit, and maintaining the old accounts until all transactions have cleared, which can be a daunting task,” said Simmons. “Our survey shows there is an opportunity for financial institutions to streamline this process for customers, and in doing so, gain or create more satisfied customers.”

Nearly one-fourth still receiving paper bills

“Although our industry has made great strides in increasing the number of people who pay bills electronically, there is still more work to be done to encourage people to opt out of receiving paper bills,” Simmons said.

Of those surveyed, 77 percent receive at least one bill electronically, leaving 23 percent who still receive all paper bills. Of the respondents who received electronic bills, 47 percent were most likely to receive internet and cell phone bills, 43 percent received electricity bills, and 42 percent received credit card and cable bills. Car and department store bills were the least likely to be received electronically, at 20 percent and 17 percent respectively.

“Not only are electronic payments faster and can save someone from a host of identity theft problems if their paper financial statements and documents aren’t properly disposed, they can save the environment as well. According to PayItGreen, for every U.S. household that switches to electronic payments and billing, six pounds of paper would be saved each year, the equivalent of more than 23 pounds of wood,” added Simmons.

About the Survey
SWACHA’s online survey of 601 Texas residents was conducted in April 2013, by Decision Analyst with a confidence interval of 95 percent and a corresponding margin of error of +/- 4 percent. Only those respondents who identified themselves as the person responsible for the paying household bills were permitted to complete the survey.

About SWACHA
SWACHA-The Electronic Payments Resource®, is one of the largest not-for-profit electronic payments associations in the country with approximately 1,100 members across the Southwest. SWACHA is the resource of choice for financial institutions and corporations in the areas of education, training, payments system risks and knowledge about electronic payments. For more information visit:

Web: www.swacha.org
Facebook: www.facebook.com/bringingpaymentstogether
Twitter: @SWACHA


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