How bill pay solutions can overcome Goldfish Syndrome
18-04-2023 5 min read
Smartphones and (social) media have destroyed the attention spans of many people. Bill pay solutions must contend with this phenomenon, as they must make people act for any payment that is not collected automatically. This blog explores how billers can overcome this so-called Goldfish Syndrome in how they reach people, get their attention, and get them to pay their bills on time – before the next funny video arrives in a WhatsApp group and they get distracted again.
According to the European Consumer Payment Report produced by Intrum based on 24,000 respondents, about one third of Europeans missed a timely bill payment at least once in 2021. And about 40% of those did so not for lack of money, but because they forgot. Those are preventable unpaid bills, resulting in preventable collections efforts and suboptimal cash flow. So why do people forget, and how can bill pay solutions do better?
It's now or never for bill pay solutions
Many of those people will have seen the email or envelope and may have even opened and understood them. But instead of doing what they know they had to do eventually (pay), they procrastinated. They decided to do it later, as something else took their attention. And then the email moved down the inbox, or the paper letter moved up the stairs or into a desk drawer. Later became never, and so the biller had to send a reminder or make a phone call. Beyond effort and cash flow, such forgetfulness can have other serious adverse consequences: late fees, suspended service, collection agencies, disgruntled customers.
The common problem is that regular bills ask people to take the details scattered across a page (amount, reference, bank account number etc.) and type them into a bank transfer. Go back and forth between bill and bank app, on a small smartphone screen. It’s that level of effort and nuisance that makes people decide to do it later. The same for registering for a client portal, logging into a client portal, resetting your password for the client portal, coming up with yet another new password, and then finding your way around the portal to finally enter your credit card details. TikTok or Netflix is more important – or at least more fun for the modern brain’s need for instant gratification. And bill pay solutions must compete with this.
Clicking beats typing
The first key to success is to use bill pay solutions that enable payment instead of just asking for it. Take those pesky payment details from your ERP system and turn them into an online payment page that is unique and ready for that specific payment. In other words, use a payment link. And deliver that payment link as a button in an email, a link in an SMS, or a QR code on a piece of paper. One action is then enough to get people on a page that presents familiar online payment options: credit card, PayPal, Apple Pay, and/or local alternative payment methods like Bancontact in Belgium, iDEAL in the Netherlands, EPS in Austria, etc. By making it very easy for people to just authorize the payment like they do when buying something online, you minimize the chances of them postponing the task.
Make sure you reach them
For people to click that payment button, you first need to reach them and get their attention. Reaching them seems easy enough: just send an email, right? But reaching tens of thousands of consumers via email is hard work that requires sophisticated tooling and expertise. You need to make sure that Gmail, Hotmail and the like recognize and trust those emails as legitimate, so that they arrive in inboxes instead of junk folders. You need to be able to effectively deal with bounced emails, lest those email clients start distrusting the email server repeatedly sending to non-existent email addresses.
Those emails need to look good, whether they’re read on an iPhone or in Outlook on a laptop. The preview that people see when the email arrives needs to be clear and call to action. The email needs to be branded and personalized, so that people know they can trust it. You need to vary with language level and tone of voice and even timing, as different people react differently to different messages.
Bill pay solutions take the process
Still, it can of course happen that the email slides down the inbox anyway, pushed down by offers and newsletters, while the recipient is working or having fun. People have a lot going on. Bill pay solutions can then help by automatically resending the emails to everyone who hasn’t paid several days prior to the due date of the bills. Intrusive if it’s another paper envelope dropping on the doormat, a friendly (and cheap) digital service if it’s email.
And when email does not work, when it bounces or is not even opened after a number of days, you need to be able to use alternative channels: SMS (also personalized), WhatsApp, paper, robocalls, push notifications from a mobile app. Only then has a biller done what it could to give its customers the chance to see and pay their bills.
Pay now… but later
Another source of forgotten bill payments is financial calendar friction. People see the bill and want to take care of it now – but their next paycheck doesn’t arrive for another few days. So they make a mental note to do it when they have the money – and then they forget.
This is where Europe’s payment landscape now offers a good solution. When offering people “pay by bank” as a payment method as enabled by the PSD2 regulations, it is possible to let people select an execution date for their bank to actually execute the resulting bank transfer. So they can authorize the payment today, but let their bank execute it when their income has arrived. Quickly back to Facebook, with timely bill payment safely scheduled in their bank app.
Good bill pay solutions eliminate any barrier for people to act now. Doing so reduces collection efforts to the group of customers with real financial issues, letting collection teams focus on those vulnerable consumers. The rest of us just need some help with our Goldfish Syndrome.
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