TAWPI @ NACHA Payments

Posted by Mark Brousseau

Consumers’ use of their Internet-capable mobile phones to access online banking and pay bills online climbed significantly over the past 12 months, according to new research released and jointly sponsored by FIS, NACHA, and eCom Advisors. This research was unveiled at a breakfast press conference this morning at NACHA’s PAYMENTS 2010 Conference at the Washington State Convention Center in Seattle.

“With expanding ownership of Internet-capable smartphones, consumers’ use of their mobile devices to access online banking information, view and pay bills, and make online purchases is becoming much more mainstream. We worked with NACHA and eCom Advisors on this research to better understand the pace of mobile banking adoption and the primary factors that are driving this consumer behavior,” stated Kay Nichols, executive vice president of channel solutions at FIS. FIS is a pioneer in delivering integrated mobile banking and payment solutions that provide end-customers with the convenience and immediacy in accessing their banking information.

The March 2010 survey, completed by 1,236 U.S. consumers who own and use mobile phones, was designed as a repeat of a similar consumer survey fielded by eCom Advisors in March 2009. The 2010 research found that 27 percent of consumers who own an Internet-capable mobile phone had used the device to access their financial institution’s online banking website within the past 30 days, compared to the 2009 result of 22 percent. In addition, 20 percent of consumers who own an Internet-capable mobile phone had used the device within the past 30 days to pay bills through a financial institution or a biller website, a significant increase from last year’s response of 11 percent.

In addition to adoption and use, the 2010 research foundthat consumers’ propensity to use mobile devices to conduct banking functions correlates more to the sophistication of the mobile device rather than the consumer’s age. The percentage of consumers who reported using their Internet-capable mobile phone to conduct online banking transactions within the past 30 days varied significantly by type of device owned:

… 65 percent of consumers who owned the newest touch screen smartphones (e.g., Apple iPhone, BlackBerry Storm, Motorola Droid, Google Nexus);
… 30 percent of consumers who owned other touch screen smartphones (e.g., Motorola Surf, Samsung Impression, LG Dare);
… 27 percent of consumers who owned non-touch screen smartphones with QWERTY keyboards (e.g., BlackBerry Curve, BlackBerry 8800 Series, Samsung Gravity, Palm Treo);
… 9 percent of consumers that owned of all other types of Internet-capable mobile phone models (e.g., Motorola RAZR, Verizon Escapade, Nokia 2680 Slide, Nokia 1680 Classic).

“Some smartphones are clearly smarter than others when it comes to inducing mobile banking and bill pay usage,” stated Fred Brothers, managing partner of eCom Advisors. “Regardless of the consumer’s age, those equipped with iPhones or the newest smartphones with full-sized touch screens are twice as likely to use them for mobile financial services as those who have smartphone devices with smaller screens or keyboards,” said Brothers.

The influence of mobile device sophistication was also apparent in consumers’ bill payment behaviors. The percentage of consumers who reported using their Internet-capable mobile phone to pay bills online through a financial institution or a biller websitewithin the past 30 days varied significantly by type of device owned:

… 40 percent of consumers who owned the newest touch screen smartphones (e.g., Apple iPhone, BlackBerry Storm, Motorola Droid, Google Nexus);
… 16 percent of consumers who owned other touch screen smartphones (e.g., Motorola Surf, Samsung Impression, LG Dare);
… 22 percent of consumers who owned non-touch screen smartphones with QWERTY keyboards (e.g., BlackBerry Curve, BlackBerry 8800 Series, Samsung Gravity, Palm Treo);
… 13 percent of consumers that owned of all other types of Internet-capable mobile phone models (e.g., Motorola RAZR, Verizon Escapade, Nokia 2680 Slide, Nokia 1680 Classic).

Consistent with a key finding from the 2009 research, the 2010 study revealed that while overall mobile bill-pay adoption is increasing, there is room for financial institutions to drive market growth. Of the 20 percent of consumers who reported using their mobile devices to pay bills online within the past 30 days, 62 percent stated they went directly to billers’ websites most often, while 38 percent reported that they went to their financial institution’s website most often.

“The results reiterate that the time is right for financial institutions to expand their online bill presentment, as well as bill payment, solutions,” stated Janet O. Estep, president and CEO, NACHA. “Introducing PC- and mobile-based products that make it easy for consumers to navigate the complete billing cycle is critical to ongoing adoption. Initiatives such as EBIDS, supported via by ACH Network, offer a way to efficiently deliver electronic bills of all kinds to a wide breadth of consumers via online banking.”

What do you think?