Examining drivers of consumers’ bill payment priorities, we find that generational differences vanish for some types of bills that are considered essential regardless of age or income.
Analyzed in “The One-Stop Bill Pay Playbook,” a PYMNTS and Mastercard collaboration, a survey of 2,140 U.S. consumers, it’s evident that consumers prioritize bills first and foremost by answering the question of whether they are for necessities.
The next consideration is whether they will have to pay late fees, whether it will impact their credit report, and after that, whether the provider is more likely to cancel services for skipped bills. However, precise numbers vary by generation.
As the study states, “It may seem self-evident that bill-payers prioritize essential services over discretionary ones. Among the 73% of respondents who agreed that they prioritize at least one bill over others, 72% cited this distinction as a key reason for prioritizing one bill over another — a far larger share than identified any other factor. Other leading reasons are more subtle, however, and include having to pay late fees, cited by 31%, the effect of unpaid bills on credit reports, cited by 26%, and the risk that providers will cancel services, cited by 21%.”
Looking at generational breakdowns, the easiness of the bill pay experience appeals most to millennials (22.8%), older bridge millennials (19.4%), and Gen Z (17.8%).
“Notably, the valuable millennial segment is more likely than any other age group to place a high value on seamless payments experiences, with 23% of this cohort saying they will pay bills with the least payment friction first,” according to the findings.
It concludes that easy one-stop bill-pay is a factor “that companies can control, unlike whether a consumer considers a service to be essential.” Therefore, an easy payment experience plays an important “role regarding which bills cash-strapped consumers will prioritize, particularly among the increasingly important millennial and Gen Z age groups.”
Get your copy: The One-Stop Bill Pay Playbook