Abstract
Overview
Expedited payments - same-day or next-day bill payment services - represent a
viable revenue source for billers, financial institutions, and third parties.
The size of that opportunity, however, will vary depending on economic
conditions, consumer propensity to use the services, and how each of those
factors affects pricing moving forward. This report presents both the Javelin
forecast model analyzing the future of expedited payments revenue potential
for various players, as well as an analysis of primary consumer data regarding
the likelihood of growth in consumer usage of expedited payments, channel
selection, willingness to pay fees, and primary sources for seeking out
expedited payments services.
Primary Questions
- What effect will economic conditions have on expedited payments revenue
and consumer propensity to use expedited payments services?
- How much will consumers save in late fees by executing expedited payments?
- How much do consumers pay for expedited payments?
- With whom do consumers initiate expedited payments - banks or billers?
- Which channels do consumers choose for expedited payments?
- Which key consumer groups use expedited payments more frequently?
Report Statistics
- Authors: Bruce Cundiff, Director of Payments Research and
Consulting; Mary Monahan, Managing Partner and Research Director
- Contributors: Alan Ruperto, Forecast and Data Analyst John
Kenderski, Research Associate; James Van Dyke, Founder and President
- Length: 39 pages, 21 charts/graphs
Methodology
The consumer data in this report is based on data collected online from several different surveys:
- A random-sample panel of 2,779 households collected in April 2009, overall
margin of sampling error is
- ±1.86 percentage points at the 95% confidence level.
- A random-sample panel of 2,350 households collected in March 2008, overall
margin of sampling error is 2.02 percentage points at the 95% confidence level.
- A random-sample panel of 3,349 consumers collected in January 2007,
overall margin of sampling error is ±1.69 percentage points at the 95%
confidence level.
The surveys targeted respondents based on representative proportions of
gender, age and income compared to the overall U.S. online population.
Javelin also created a forecast model used in this report to analyze factors
in the evolution of expedited payments, based on U.S. census data and Javelin
primary consumer data.
Table of Contents
- Overview
- Primary Questions
- Findings and Analysis
- Methodology
- Executive Summary
- Javelin' s 2009 Expedited Payments Forecast
- Expedited Payments Strategy for 2009-2010
- Consumer Trend 2009
- Though Recent Usage is Down, a Substantial Base of Consumers Still
Initiate Expedited Payments
- Expedited Payments Forecasts
- Expedited Payments Expenditure
- After a Slight Dip, Expedited Payments Usage Rebounds Through 2014
- In a Recovering Economy, Savings Vastly Eclipses Spending
- Consumer Use of Expedited Payments
- Frequency - Which Represents Prime Revenue Opportunities - Declines
- Younger Consumers Show Greater Propensity for More Frequent Usage
- Alerts Users Demonstrate Usage of Expedited Payments Twice as High
- Expedited Payments by Channel
- Vast Majority of Expedited Payments Made Directly With Billers
- The Importance of Channel Availability: Phone-Based Expedited Payments
Losing Ground
- Expedited Payments Pricing
- Pricing is Highly Dependent on “Convenience vs. Necessity”
- Expedited Bill Payments Users Save Substantially on Late Fees
- Mid-Range Fees Are Predominant: The Case for Price Decreases
- Certain Age Groups May be Poised for Expedited Mobile Channel Growth
- Appendices: Additional Consumer Information
- Expedited Payments Used for Credit Card, Home Payments, Mobile Bills
- Spike in Use Among Higher-Income and Lower-Income Consumers
- Varied Usage of Expedited Payments Among Age Groups
- Recent Expedited Payments Usage Among Various Income Groups
- Spike for Younger Consumers in Avoiding Higher Late Fees
- Higher- and Lower-Income Consumers Avoid Larger Late Fees
- Affluent Consumers Pay Lower Fees for Expedited Payments
- Alerts Users Demonstrate Higher Frequency of Expedited Payments
- Related Research
- Companies Mentioned
Table of Figures:
- Figure 1: Consumer Usage of Expedited Payments 2008-2009
- Figure 2: Overall Consumer Expedited Payments Expenditures 2006-2014
- Figure 3: Household Usage of Expedited Payments 2006-2014
- Figure 4: Usage, Spending and Savings in an Improved Economy
2009-2014
- Figure 5: Frequency of Usage for Expedited Payments 2008-2009
- Figure 6: Frequency of Usage for Expedited Payments by Age
- Figure 7: Last Time Used Expedited Payments Consumers who Received
an Alert Last 90 Days vs. All Consumers
- Figure 8: Venue for Expedited Bill Payment among Consumers
- Figure 9: Consumer Channel Selection for Expedited Payments
- Figure 10: Mean Pricing for Expedited Payments through 2014
- Figure 11: Late Fees Avoided for Expedited Payments 2005-2008
- Figure 12: Consumer Fees for Expedited Payments 2008-2009
- Figure 13: Consumer Channel Selection for Expedited Payments by Age
- Figure 14: Type of Bill Paid With Last Expedited Payment
- Figure 15: Frequency of Expedited Payments Usage by Income
- Figure 16: Consumer Usage of Expedited Payments by Age
- Figure 17: Consumer Usage of Expedited Payments by Income
- Figure 18: Late Fees Avoided by Expedited Payments by Age
- Figure 19: Late Fees Avoided by Expedited Payments by Income
- Figure 20: Fees Paid for Expedited Payments by Income
- Figure 21: Frequency of Expedited Payments from Consumers who
Received an Alert in Last 90 Days vs. All Consumers
Companies Mentioned
- ClairMail
- M-Com
- ORCC
- Western Union
- Yodlee
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