Friday, May 28, 2010

Use of Online Banking and Bill Payment Continues to Grow

According to the 2010 Consumer Billing and Payment Trends survey published this week by Fiserv, the number of households that use online banking increased more than six-fold between 2000 and 2010, and the number that use online bill payment increased nearly eight-fold. In fact, 72.5 million U.S. households (80 percent of all households with Internet access) use online banking, while 36.4 million households (40 percent of all households with Internet access) use online bill payment.

Illustrating that online bill payers are not just the youngest and wealthiest demographic, in 2010, consumers age 21-34 made up 28 percent of online bill payers, consumers age 35-54 made up 48 percent, and consumers over age 55 made up a surprising 24 percent of all online bill payers, while more than a third of online bill payers had a yearly household income of less than $50,000.

In addition, as other studies have shown, consumers who pay bills online consistently use more services from their financial institution than the average customer, with usage of additional services becoming even more pronounced in recent years. Loyalty is also strong, with 49 percent of customers who use online bill payment saying they were less likely to switch to another financial institution as a result of their experience with the service.

Fiserv suggests that with the similar benefits of biller direct and emerging technology alternatives (such as PFM), it will be more important than ever to illustrate the benefits of bank-based online bill payment including the consolidation of billing and payment into a single site and the ability to eliminate the need to remember multiple passwords.