Why 75% of Lenders Are Adding New Payment Processing Options
“Do you want my money?” I wondered as I left the website of a lender that didn’t accept debit cards. You see when lenders offer new payment processing options they increase dollars collected by 15%. To increase collections and meet growing customer expectations 75% of lenders are currently adding new payment processing options.
Here’s what’s motivating this behavior:
- Competition is heating up
76% of loan servicing leaders say they face growing competition in the billing and payment experience. The billing and payment experience is the most frequent interaction you have with your customers. No wonder billing and payment determines 58% of customer satisfaction with their lender.
- Lenders need to quickly respond to changing behaviors
As competition for new loans grows, only 24% of lenders say they are flexible enough to handle new payments innovation. Customer expectations for the payment experience are growing as they look for video eBills, text reminders and virtual collections. As the speed of change accelerates, it’s harder for lenders to keep up. Those who offer new payment processing options are already ahead of the game.
- Customer preferences shifted to electronic transactions
A major shift happened in 2016. The battle to provide the best payment experience now mainly takes place through electronic interactions. Now more companies (80%) accept electronic payments than paper (65%).
- Electronic payments now dominate
85% of loan payments are now made electronically. Each of these payments provide an interaction for lenders to promote additional services with targeted offers.
- SaaS makes it faster to add new payment options
SaaS frees lenders from waiting on internal IT resources to meet new customer demands. Spending on SaaS loan payment systems will grow 53% through 2021 vs. 24% for in-house systems, according to research firm Ovum.
- New payment options boost profitability
75% of lenders are deploying new payment options as we speak. These new payment options (eBill, mobile and recurring payments) not only boost revenue, but also profitability by replacing paper and manual interactions with electronic interactions.
- New payment options reduce call center volume
One loan servicing leader reduced call center calls by over 25%. They migrated payments from their call center to a new web and IVR payment system.
- Tech integration benefits your bottom-line
This same loan servicing leader lowered internal infrastructure costs by 25% by improving technology integration. They integrated their payment system in real-time to their ERP system. Further increasing their savings, they launched a single bill payment solution integrated across mobile, web, IVR and call center channels.
To hit your top-line goals and deepen customer loyalty your bill payment solution cannot remain stagnant.
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