Why should fintechs embrace modern bill pay technology? According to Daniel Hawtof, BillGO’s SVP of Bill Pay Product, fintechs need to embrace modern bill pay for many of the same reasons traditional banks do.
“For those fintechs that currently offer some bill pay capabilities, I tell them they must ensure they have a modern solution to enhance customer satisfaction, reduce back-office costs and improve efficiencies,” says Hawtof.
For those fintechs that don’t offer bill pay, Hawtof provides a different rationale: “because bill pay is something users do every day or every week, adding bill pay functionality can attract new users, deepen existing customer relationships, and give a fintech the ability to broaden its users and generate more revenue.”
In addition to overseeing BillGO’s Bill Pay Product features, Hawtof is also responsible for the delivery of BillGO’s bill pay solution, which requires him to provide strategic direction in the development of BillGO’s UX APIs and widgets.
“A More Modern UX”
He often meets with fintech execs who might be unclear — or unconvinced — about the value of modern bill pay technology. Luckily, Hawtof is a veteran of the fintech industry, meaning he talks the talk. Prior to joining BillGO, he served in a variety of fintech leadership roles, overseeing market research, product development and management as well as UX and UI design. He has worked for both early-stage fintech startups as well as industry giants such as Avnet and HP.
When asked why he believes most online bills continue to get paid directly to billers instead of financial institutions, he says the answer is simple.
“Consumers have moved away from bill pay services financial institutions (FIs) offer and moved to paying billers directly because they want a faster way to pay and more modern UX,” he says. “Many banks have not kept pace with modern user experience expectations.”
This is one reason, he believes, why so many fintech execs are now eagerly working with BillGO.
“Fintechs are experts at user experience and they chose to collaborate with BillGO because they recognize we can deliver a unique, positive bill pay user experience,” Hawtof says.
It’s this expertise in UX, Hawtof explains, that draws so many mainstream FIs towards collaborating with fintechs.
“Banks recognize their customers — especially younger customers — expect an easy-to-use mobile experience with features that enable them to manage their financial lives,” Hawtof says. “Fintechs have created a broad range of these features so users can track their spending, stick to a budget, get paid faster and manage their subscriptions. Banks see this trend and want to follow. Or, at the very least, they want to partner with fintechs so they can offer these feature rich, modern user experiences.”
Bill Pay Choice
Given the consumer demand for choice, Hawtof is not surprised to learn that most consumers prefer to pay their bills with credit and debit cards.
“Payment choice is critical to today’s bill payers. The combination of credit card, debit card and even automated checking account deductions empower them to better manage their finances. Not only do these payment options offer more convenience, security, and speed, but six-out-of-ten consumers realize they earn rewards when they use cards to pay bills.”
BillGO's new eBook includes findings from Mercator Advisory Group showing 33 percent of consumers expect bill payments to be paid instantly while another 22 percent expect bill payments to clear in an hour.
What’s the rush?
“Consumers are busy,” says Hawtof, “and real time bill pay is hard to deliver. Most banks and fintechs don’t want to invest the time or resources to build the technology and payment network necessary to make real time — or even same-day payments a reality. But BillGO has built (and continues to invest in) the technology and payment network to ensure we are on the leading edge of real time payments.”
Fintechs and FIs: Lessons Learned
In light of the fintech/FI collaboration Hawtof is seeing, we asked if there anything fintechs can learn from traditional FIs?
“Banks offer some important services and fintechs can learn a lot from these.,” he says. “While it’s true that some banks may not be focused entirely on introducing innovative solutions, they are still very good at helping their customers manage their financial lives. Meanwhile, many fintechs are only focused on innovation. Fintechs can actually learn a lot about the quality of the customer service banks provide.”
And what can banks learn from fintechs?
“Banks listen to their customers, but many have been slow to react. They aren’t built to rapidly evolve around user needs,” Hawtof says. “We’ve noticed that many of BillGO’s bank customers recognize their bill pay experiences have not evolved in years, but they also recognize that by collaborating with fintechs like BillGO, it can help them move faster and change their approach in meeting the needs of today’s consumers.”
Want to Know More?
Whether you are an executive overseeing an established financial institution or running a fast-paced fintech, it is imperative for you to understand the needs of your customers.
BillGO’s latest eBook, Winning the Battle for Bill Pay, delivers a dozen pages of research from Aite Group, PYMNTS, Mercator and others detailing what consumers want and need in bill pay technology.
Download your complimentary copy today.