Consumer Expectations & Experiences

I’ve written in past years about the Fiserv Billing Household Survey, which describes consumer trends in paying bills. You can read those articles from 2013, 2015, and 2016.

I’ve been checking periodically to see if Fiserv released a similar survey for 2017, but can’t locate one. However, I did find a research paper, Expectations & Experiences | Consumer Payments, from April, 2017. You can download the paper from this link. Downloading requires your name and contact information but, from experience, I can assure you they won’t spam you!

Highlights from the paper

Here are some highlights from the research paper I think utilities would do well to pay attention to:

  • 74% of online banking users use online bill pay (page 3)
  • In the 30 days prior to the survey, the number one reason consumers used online banking was to pay bills (page 4)
  • 79% of consumers are satisfied with online bill pay (page 6)
  • Convenience is the number one reason consumers use either their bank’s online banking bill pay service or online bill pay directly from billers (page 7)
  • 76% of consumers say real-time payment delivery is at least somewhat important (page 9)

What does this mean for your utility?

Clearly, the trend is towards paying bills online, whether that means using your online bill pay site or your customer using their bank’s bill pay service.

If you don’t already offer online bill pay, I recommend you move as quickly as possible to start offering it.

If you do offer online bill pay through a third party, and it’s not fully integrated into your billing system (i.e. you have to import payments the next day), I encourage you to investigate a fully integrated online bill pay solution.

The final takeaway is, if you are still receiving paper checks when your customer pays using their bank’s bill pay service, to consider using a payment consolidator to receive those checks electronically.

Are you offering all the latest payment options?

If you’ve ever wondered if you’re offering the most popular payment options, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to discuss how a business review could benefit your utility.

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© 2018 Gary Sanders

Should you accept echecks…?

So you’ve got your online bill pay system in place and now you’re faced with what payment methods to offer. This includes which credit cards to accept and, more importantly, whether or not to accept echecks.

What is an echeck?

Echeck payments provide your customers the opportunity to enter their bank routing and account numbers and submit a payment to be electronically transferred from their bank account. This process is essentially the same as a bank draft, except the customer initiates the process rather than your office sending an ACH file to the bank.

Advantages of echecks

First, let’s examine why you might want to accept echecks. For starters, transaction fees are generally lower for echecks than credit cards. This means, if your utility absorbs the cost of processing online payments without charging a convenience fee, it costs you less to process an echeck than a credit card payment. If you charge a third party convenience fee, your customer will pay less than if they were to pay using a credit card.

Another reason to consider accepting echecks is some customers have checking accounts but no debit card so, without the echeck option, they wouldn’t be able to pay online.

Disadvantages of echecks

As was posted last week on one of the listservs I follow, echecks are subject to being returned if the customer incorrectly enters the echeck information.

This is because, unlike credit cards, there is no validation of the routing or account numbers as your customer is entering the payment. Likewise, there is also no verification of funds availability.

What this means is, unfortunately, echeck transactions are subject to honest mistakes in entering the information or, in some cases, outright abuse. I have had utilities tell me they are certain they have had customers intentionally enter erroneous echeck payments just prior to cut-off day to avoid being disconnected. This can work to the customer’s advantage if your returned check fee is less than your cut-off or reconnect fee.

The only real solution is to not accept echeck transactions and encourage your customers to use a debit card to pay from their checking account.

A reminder for North Carolina utilities

If you work for a North Carolina water utility, you should have received an invitation from the Environmental Finance Center to participate in a Utility Management Survey conducted by the EFC and North Carolina League of Municipalities.

If you, or someone at your utility, didn’t receive this invitation, please email the EFC directly at efc@sog.unc.edu and they will provide you with the specific survey link for your utility.

Should you offer additional payment options?

Do you ever wonder if your office should offer additional payment options? If so, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could benefit your utility.

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© 2017 Gary Sanders

Want to learn more about remittance processing?

If you’ve been a reader of the Utility Information Pipeline for any length of time, you know one of my recurring themes is improving efficiency in utility business offices.

One of the easiest ways for utility offices to become more efficient is to offer better options for your customers to pay, beyond the basic checks in the mail and walk-in payments.

Previously, I’ve written about the easiest way to collect payments, accepting credit cards, online bill pay systems, automating phone credit card payments, streamlining online banking checks, and alternatives to entering mail payments.

Free, informative webinar

One of the alternatives to entering mail payments manually is a remittance processing system. If you’d like to learn more about remittance processing systems, Logics is hosting a free webinar with our partner, ProfitStars, on Wednesday, November 29, 2017 at 2:00pm eastern time. During this webinar you will learn how ProfitStars’ RemitPlus remittance processing system can save time entering mail payments.

Utilizing a desktop scanner, RemitPlus software provides efficiencies that some customers have claimed cut their check processing time by over 75%. Several Utility Information Pipeline readers are already taking advantage of the great tools provided by RemitPlus.

Please plan to participate in this informational webinar to discover the benefits of RemitPlus, including:

  • Scanning software that allows check and coupon payments to be auto-posted (i.e. without human attention to each item)
  • Exporting of both a Check21 bank deposit file and an auto-posting file from a single pass through a scanner
  • Unlimited storage and simplified access of check images for improved customer service
  • Elimination of problematic paper checks from bank bill pay systems

To register for the webinar, please click here.

Are you processing payments as efficiently as possible?

Do you ever wonder if your office could more efficiently process payments? If so, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could benefit your utility.

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© 2017 Gary Sanders

Is this really poor customer service…?

Recently, I was presenting my Improving Revenue Collections for Utilities presentation to the Alliance of Indiana Rural Water Fall Conference.

Part of my presentation deals with offering additional payment methods, such as bank drafts, online bill pay, and IVR payments. While discussing these, I stress how important it is to offer convenient ways for customers to pay without visiting the office.

Audience concern

About midway through my presentation, a gentleman on the back row raised his hand to voice an objection. This gentleman works in the industry, but not for a utility, and his concern was something to the effect of “it sounds like you are advocating for utilities to be less customer friendly by encouraging their customers not to come to the office to pay.”

My response

I explained that, quite the opposite, I firmly believe in – and advocate for – utilities providing outstanding customer service. I went on to explain that some customers, especially millennials, actually prefer not to interact in person.

By offering a fully integrated online bill pay system where customers can research their billing and usage history and make payments, your utility is actually providing an invaluable customer service. By doing so, and thereby reducing the number of calls or visits to your office, you actually free up staff time to more effectively deal with customers who have more serious issues.

By devoting enough time to adequately research and assist customers with excessively high bills or to set up a payment plan, your utility is able to offer even better customer service. If your staff time is consumed with walk-in customers merely wanting to make payments, they won’t have the time to devote to those customers who truly need the attention.

Do you ever wonder…?

Do you ever wonder if your office staff spends too much time dealing with walk-in customers? If so, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could benefit your utility.

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© 2017 Gary Sanders

5 easy ways to get more bank draft customers

Recently, during a sales presentation, I came to the bank draft tab in Logics’ Utility Management application. I asked, as I always do, if they accepted bank drafts. The City Administrator spoke up and said he wished 99% of their customers were bank draft customers. When I asked why not 100%, he replied “There’s always that one percent that won’t do it, no matter how much sense it makes.”

After everyone stopped laughing, one of the office staff asked if I had any ideas how to increase bank draft participation. Interestingly enough, I had just finished the first draft of an ebook entitled 5 Surefire Ways to Save Time Processing Payments. The first of the five ways is bank drafts and the chapter goes on to list five ways to promote bank drafts.

Here they are…

1. Waive the first late fee in exchange for signing up for bank drafts

Whenever a customer calls to complain about being charged a late fee, offer to waive the penalty if they sign up for bank drafts. Once they are a bank draft account, they will never be late again!

2. Offer incentives to sign up

I know of utilities that offer a one-time $5.00 credit for signing up for bank drafts. Others give a $1.00 per month credit for the first year the customer is drafted.

3. Ask every new customer if they want to pay by bank draft

Have you applied for a life insurance policy recently? Insurers practically make issuing the policy contingent upon the insured agreeing to pay by direct debit. Why not deal with new customers applying for service the same way? There’s an age-old adage in sales, “assume the close”, and the same technique can work for signing new applicants up for bank drafts. Why not hand them a bank draft form along with the application to sign?

4. Include a signup form on your website

Ideally, your customers should be able to complete an online form with the bank draft information. But, if not, at least post a downloadable sign-up form on your website so your customers can complete and return it to your office.

5. Promote bank drafts on your utility bill

Does your utility bill have a section for comments you can enter each billing? Why not use this to publicize bank drafts along with whatever other announcements you have that month? If you print full-page bills, you can also include a bank draft sign-up form as an insert with the utility bill.

How do you promote bank drafts?

What does your utility do to promote bank drafts? Do you have a unique or innovative way of encouraging your customers to sign up for bank drafts? Please leave a comment at the bottom of this post for other readers to see.

2017 Utility Fee Survey results

The next Utility Information Pipeline, to be published on July 18, will include the first set of results for the 2017 Utility Fee Survey. The survey technically closed at the end of the day, June 30, but I haven’t started recapping the results yet.

If you haven’t participated and would still like to, you may click here to complete the survey. It should take less than five minutes to complete.

Trying to streamline payment processing?

If you’re looking to reduce the amount of time it takes to process payments, or streamline any other part of your operation, please give me a call at 919-232-2320, or email me at gsanders@logicssolutions.com for more information about how a business review could help you review your entire office operation.

 

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© 2017 Gary Sanders

What is your policy regarding loose coins?

You’ve probably read articles online or seen television news accounts of irate customers protesting a bill by paying entirely with coins. If you haven’t, just Google “coins as payment protest”. There’s even this story about a Michigan woman paying her entire $569.81 adjusted water bill with coins!

Listserv inquiry

A post from earlier this summer in a listserv I follow inquired if others in the listserv had policies prohibiting customers from paying with an excessive amount of coins. Apparently the poster has experienced this problem, or is at least interested in not experiencing it in the future!

Are you prepared to keep it from happening?

In an earlier Utility Information Pipeline, I wrote about a utility that doesn’t accept cash at all, so for them this wouldn’t be an issue. However, if your utility is like most I’m familiar with, you still accept cash and, without a policy to stop it, could be susceptible to an angry customer trying to pay with all coins.

Most banks won’t accept an excessive amount of coins for deposit unless they are rolled. So requiring any payment in coins (in excess of the amount of a roll of that denomination) to be rolled does not seem unreasonable. Also, entirely reasonable in my opinion, would be a limit to how much in rolled coins can be tendered for a single transaction.

How do you handle loose coins?

How does your utility deal with loose coins? Please take this quick poll.

 

Once you’ve taken the poll, you can see the results to see how other utilities responded. If you have a loose coins policy, please feel free to post the specifics of your policy in the comments. Click here to see the results.

Are your payment policies up-to-date?

If your payment policies are outdated, or if you think you could improve on how you take payments, please give me a call at 919-232-2320 or email me at gsanders@logicssolutions.com for more information about how a business review could help improve your operation.

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© 2016 Gary Sanders