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How To Build Better Online And Mobile Bill-Pay For The Underbanked
Javelin Strategy & Research, March 2013, Pages: 33
When it comes to paying bills, too often the nation's 37 million underbanked Americans do it using hard and costly ways: in cash, and in person, by mail, or by phoning call centers. This creates an opportunity for financial institutions, billers, mobile carriers, and bill-pay innovators to cut processing costs if they can enhance online and mobile options with electronic payments for this underserved segment. Financial institutions should take note, however, that innovative and compelling offerings from non-traditional banks, non-FIs, and prepaid-card issuers demonstrate that the term “underbanked” incorrectly implies that banks must provide the answer.
This report includes a four-part profile of underbanked Americans, an analysis of how they typically pay seven of the most common bills, and recommendations for motivating them to increase the use of online and mobile bill payments.
- How many Americans are underbanked, and what is their general profile?
- What payment methods – cash, checks, prepaid, etc. – do the underbanked use most to pay bills?
- What payment channels – in person, over the phone, with digital payments, etc. – do the underbanked use most to pay bills?
- Are the underbanked willing or able to pay bills online or on mobile devices?
- What technological investments and marketing messages will be most likely to boost the use of online and mobile payments among the underbanked?
Table of Figures
Overview and Primary Questions
The ROI of Helping the Underbanked Pay Bills
The Underbanked: Market Sizing and Profile
An Underbanked Profile
The Underbanked's Choice of Payment Channels Points to Opportunities to Improve Service and Cut Costs
Underbanked Favor Cash or Prepaid Cards
in Person, by Mail, and at Call Centers
Paying Bills Online
Mobile Bill Payments
A Case Study for the Need for Digital Payments
How to Motivate Underbanked Consumers to Try Online and Mobile Payments
Table of Figures
Figure 1: Underbanked Adults as a Percentage of U.S. Population
Figure 2: Demographic Profiles of the Underbanked
Figure 3: Type of Wireless Plan for Mobile Phone Owners (Underbanked vs. All Consumers)
Figure 4: Financial Accounts and Products Owned (Underbanked vs. All Consumers)
Figure 5: Common Bills the Underbanked are Responsible for Paying
Figure 6: Percent of Underbanked Who Typically Pay Common Bills in Cash
Figure 7: Percent of Underbanked Who Typically Pay Common Bills with Prepaid Cards
Figure 8: Percent of Underbanked Who Typically Pay Bills by Walking In
Figure 9: Percent of Underbanked Who Typically Pay Bills by Mail
Figure 10: Percent of Underbanked Who Typically Pay Bills by Phoning Call Centers
Figure 11: Percent of Underbanked Who Typically Pay Bills at Biller Websites
Figure 12: Percent of Underbanked Who Typically Pay Bills at Primary FI
Figure 13: Percent of Underbanked Who Typically Pay Bills by Mobile Payments
Figure 14: Typical Channels Used to Pay Utility Bills (Underbanked vs. All Consumers)
Figure 15: Important Factors in Choosing a Bill-Pay Method (Underbanked vs. All Consumers)
- American Express
- Green Dot
- U.S. Bank