New report: Building the future of bill payments
In today’s rapidly evolving digital landscape, consumer preferences and expectations are reshaping the way we engage with financial transactions. Choice lies at the heart of consumers’ financial lives, including how they pay their bills — from traditional methods like checks and cards to emerging technologies like account-to-account payments.
To understand how consumers prefer to pay their bills and why, and how they want to do so in the future, Mastercard surveyed over 2,000 consumers across the U.S. We explored the evolving landscape of consumer payment preferences, focusing specifically on the intersection of choice, convenience, and security, and how these core tenets will shape the future of bill payment.
Explore some of the highlights of the report below or download the full report here.
An overview of bill payments and preferences
Consumers are looking for a seamless, efficient, secure way to pay their everyday expenses. The research shows that they are consistently turning to credit and debit cards, as well as options where they can pay directly from their bank accounts, like Bill Pay and ACH/e-check options.
The most often used payment method for recurring bills is topped by credit cards at 47% followed by bill pay features through banks at 41%, debit card at 39% and ACH at 37%.
Looking forward, respondents are inclined towards similar payment methods for future recurring bills, with credit cards and bill-pay-by-bank features leading the way. This trend underscores the reliability and trust needed for recurring expenses.
Consumers are driven by choice
Consumers want three fundamental things in their payment experiences: choice, convenience, and security, and they want payment solutions that empower these elements.
Placing high value on having choice and flexibility in payment methods when paying their bills, an overwhelming number of respondents expect businesses to provide multiple payment options, indicating a strong demand for variety in how they pay.
However, only 51% of respondents feel they are frequently given the opportunity to choose their preferred payment method. This suggests a sizable gap in businesses meeting these expectations consistently.
Convenience, cost and security pave the way for open banking
Based on the data, there is a clear opportunity for more businesses to embrace new kinds of payment methods supported by open banking technology.
These new methods use consumer-permissioned connections to bank accounts for payment data rather than having the consumer input their card or account and routing numbers.
The majority of consumers, across all age groups, are open to new pay-by-bank methods that would save billers money and reduce the likelihood of non-sufficient fund returns – as well as offering security, convenience, and support for consumers to manage their finances.
Download the bill payments report to learn more about how open banking increases choice in bill payments for consumers and businesses, or head over to our open banking blog for inspirational use cases and insights.