It’s no secret that today’s payment services has become more varied and competitive than ever before – especially when it comes to consumer banking solutions. Direct billers, neobanks, and digital applications have done an exceptional job of providing unique, modern, and tailored experiences that have transformed everything from bill pay to money transfers.
In 2023, 5 of the top 10 companies in mortgage lending volume were banks and credit unions. Additionally, 77% of all online payments are made on direct billers’ digital solutions—a number that has steadily grown in recent years. And if you’re looking to pay a friend for lunch, you’ll likely “Venmo” them.
Long-lasting relationships are the lifeblood of any financial institution. Being displaced in any fashion, whether it be bill pay or peer-to-peer (P2P), invites the risk of churn and lost revenue opportunities. If your financial institution is no longer the hub of payment activities for consumers, there’s a good chance that a consumer may seek alternatives when opening a new credit card or applying for a loan.
As we are in the midst of what is considered the greatest intergenerational wealth transfer in history, if you want a slice of that pie, you must consider strategies that will keep you relevant to the lives of the receiving generations and beyond.
The percentage of bill payments made through financial institutions’ websites continues to drop. According to Paymentus’ latest How Americans Pay Their Bills industry report, the percentage of bills paid online through financial institutions’ websites has shrunk from 38% in 2020 to 23% in 2023.
However, according to The State of Online Payments report, digital bill payments adoption has grown rapidly and continues to do so – but many consumers also complain that the process could be smoother and more helpful, and they have concerns about security and reliability.
This is a phenomenal opportunity for banks and credit unions that, when equipped properly, can deliver centralized, seamless and secure bill payment solutions. The challenge then becomes implementing a solution that not only centralizes bill payment but also delivers the speed, choice, and control that make direct biller bill payment experiences so attractive.
For banks and credit unions to again become a hub of payment services, it is imperative that they build on the best of direct biller payment experiences and make them their own. This begs the question, what makes the direct biller payment experience so attractive to consumers? Obviously each consumer is unique, but overall, the benefits can be boiled down to:
But there is a business case for modernization that goes beyond the bill payment experience. Financial institutions can gain a unique advantage in how their bill payment capabilities can leverage consumer data to improve the overall experience, weaving in related money movement services.
For instance, imagine a scenario where you can alert a consumer that their account balance is too low to cover upcoming scheduled payments, accompanied by a link to transfer money from another account. Or sending a notification that says, “Thanks for connecting your XYZ credit card. Looks like you also have a checking account with XYZ. Would you like to connect that for transfers?“
This transforms the financial institution’s ability to serve consumer needs and provides consumers with a central hub to both pay monthly financial obligations and enjoy a greater level of convenience and control over their financial lives.
Bill Center by Paymentus was purpose-built to capitalize on the centralization opportunity by delivering a direct bill pay experience directly in a bank or credit union’s online banking experience. Bill Center is backed by the Paymentus Instant Payment Network® (IPN), which allows financial institutions to become a direct biller aggregator by seamlessly connecting to a wide array of billers. This allows users to link eligible bills directly into one centralized location.
The IPN goes further than direct linking by enabling attractive features that include full bill details, real-time confirmations, expanded payment options, autopay, and much more. In essence, Bill Center and the IPN eliminate the need for consumers to visit multiple locations to pay their bills.
Instead, consumers visit their financial institution’s website and log into their Bill Center account. From there, they can link their bills, pay using ACH, credit cards, and debit cards, set up AutoPay, view their full bills just as they would on a direct biller’s site, and receive an instant notification that a bill has been paid.
Bill Center is just one (large) part of the full suite of Paymentus Banking & Fintech offerings. Loan Payments, account-to-account (A2A) payments, and P2P payments are among the other consumer banking solutions that give financial institutions the ability to surround consumers with intuitive and modern payment experiences.
Whether financial institutions combine these products or mix and match as currently needed, the interplay at hand will allow them to help consumers fulfill their payment obligations, transfer money, pay friends and family, and once again become a hub for consumers.
Want to see what your bank or credit union stands to gain from a centralized bill pay experience? Come visit us at Alkami Co:lab 2025 and let’s talk! Our team can give you an exclusive look at how the Paymentus Banking & Fintech suite of offerings can enhance your digital banking solutions and help your organization reclaim its place at the heart of your consumers’ financial lives.