Learn how Lexop, a fintech company, conducted a survey of American consumers to understand past-due consumer behavior and identify payment patterns.
In order to better understand past-due consumer behavior, identify payment patterns, and show how businesses can better serve their customers, Lexop, a fintech company that helps organizations automate and scale their collections operations, conducted a survey of American consumers. The research showed that making little changes to invoicing and collection procedures might considerably lower delinquency rates and encourage past-due consumers to self-cure. According to Lexop’s “Behind on Bills: A 2023 Survey of Overdue US Consumers,” more than 1,100 Americans were behind on their bill payments.
44% of respondents’ 2023 financial objective was bill paying. 25% of respondents indicated they prioritize debt repayment. Due to a delayed or missed payment, 43% of consumers had to use their savings to survive. 36% can’t afford their payments.
In light of these findings, Lexop is urging companies to be proactive in offering customers other payment options, such as creating personalized payment plans, and to take into account their financial reality when issuing invoices.
It’s interesting to note that 60% of respondents said they fell behind on their expenses due to non-financial reasons. The following were the top four reasons:
- 30% of people neglected to pay the bill.
- 10% of invoices had mistakes
- 8% mentioned pre-authorized payment methods that had expired.
- 7% of people had trouble paying their expenses.
- 5% of people didn’t get any bills at all.
These non-financial reasons for being late emphasize how crucial it is to promptly remind clients and deal with systemic problems that cause late payments.
Assisting customers in timely payment
Consumer preferences for bill payment notification schedules were also surveyed by Lexop. A reminder one week before to a bill’s due date is preferred by 55% of respondents. An additional reminder the day before the due date was desired by 22% of respondents.
The poll found that 85% of late payers paid within 30 days and 60% during the first week. Businesses may immediately enhance cash flow and reduce late payments by employing digital technologies to give consumers more frequent automated reminders.
With more reminders delivered through SMS and email, a streamlined online payment process, and one-click payment links, 73% of respondents felt that a simplified digital experience would make paying their past-due bills easier.
Only 10% of respondents said that conventional strategies like mailings and collection calls are effective. To fulfill consumer expectations for a streamlined, self-serve digital payment experience, companies aiming to increase their collection rates might need to prioritize technology expenditures.
Amir Tajkarimi, Lexop CEO and co-founder, says businesses must rethink bill payment methods: “Collecting isn’t hard. It all boils down to attracting your past-due customer’s attention and making it simple for them to make a payment. Businesses must take initiative now more than ever to be successful in their collecting operations. With the use of technology, it’s simple to offer flexible payment alternatives, automate timely reminders, and provide digital payment methods.