Abstract
Overview
Expedited payments - which mean same day or next day bill payment services -
represent a viable recurring revenue source for billers, financial
institutions, and third parties. This report presents Javelin' s annual
forecast model for expedited payments, building upon four years of solid
historical consumer data. Based upon the current revenue sharing split between
biller and banks, financial institutions stand to lose $5 billion in fee
income over the next five years, unless institutions act now to influence
consumer habits. This report includes an analysis of 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
marketing strategies and key consumer demographics are defined for 2009.
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?
- How can financial institutions effectively market expedited payments
services?
Methodology
The consumer data in this report is based on data collected online from
several different surveys:
- A random-sample panel of 2,350 respondents in March 2008. Overall margin
of sampling error is ±2.86 percentage points at the 95% confidence
level.
- A random-sample panel of 3,367 respondents from August 2008. Overall
margin of sampling error is ±1.70 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.
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