Issue 9

What did Australians think of BPAY in 2009? Read this article to find out.

BPAY's 2009 Usage and Attitude study is now complete. This year, we expanded the survey to include 66-75 year old respondents and continued to include youths (16-25 year olds). After 8 years of tracking 4,000 bill payers' usage and attitudes toward BPAY here is a snapshot of how far we have come:

• More than 50% of users are committed to BPAY; a significant increase on the 34% when the study first began.
• Growth in use of the internet to pay bills has gone from 23% in 2003 to 84% in 2009.
• More than two thirds of people had used BPAY internet in the 12 months prior to October 2009, and BPAY continues to experience double digit growth

The overall objective of the research is to gain a clear understanding of trends in the Australian payments market. It gives us a picture of BPAY's performance in terms of how open non-users are and how committed users are to the brand. It compares BPAY's performance to its competitors and measures the consideration to use BPAY. The research is also designed to provide insight about new payment channels (e.g. mobile banking), usage and attitudes of relatively new bill payers (i.e. youth market), electronic bill presentment and the impact of billers charging for paper bills.

The backdrop of 2009: the GFC

A key consideration in this study was the 2009 global financial crisis. The research gauges how sentiment was changing throughout 2009. While there was a negative shift in sentiment around "being comfortable with my finances" in October 2008, there appeared to have been some improvement in June (2009) and a more positive shift by the end of 2009.

The Key Findings

How things have changed: Over the past eight years, we have analysed the bills consumers pay and the type of bills they are paying. In 2009 compared with 2002, there has been a decrease in the number of utility bills paid monthly but an increase in internet, mobile phone and credit card bills. Some of the reductions in monthly utility bills over this period is due to the merging of a number of key utility businesses.

Payment channels: Predictably, the internet is the payment channel of choice with 84% of Australians using it to pay bills (electronic payments include: BPAY, online via credit or debit card and 'pay anyone'). Next is direct debit, with 79% of Australians using this method for making payments.

Source Account: While the main source account is savings, 2009 saw a decline from 28% to 24% in credit cards as the source account for paying bills against all bill payment methods. This result could be attributed to the GFC and tightening of consumer belts as well as a significant proportion of Australians (40%) being aware they have been surcharged for making a payment using a credit card or credit card account.

Brand awareness: The awareness of BPAY has remained stable at 90% of the bill paying population aware of BPAY. BPAY boasts the highest spontaneous awareness at 63%, with its closest competitor being direct debit at 32%.

Brand health: BPAY own the top three criteria for choosing a bill payment method - security, convenience and ease of use. In fact in 2000 BPAY had the highest association with all factors surveyed.

Over the last 8 years, there has been enormous growth in the number of committed BPAY users, from 15% to 38%. The closest competitor is direct debit with 21% of its users committed. This is important as committed users tend to use the service more and critically, they are less likely to move to another payment method.

Usage: BPAY has the second highest usage level with 74% of all bill payers stating they had used BPAY in the last 12 months, direct debit was the highest at 79%. BPAY however has the highest share of an individual's total number of bills as shown in the graph below.

The majority of users (62%), have been using the service for more than 4 years, demonstrating loyalty to BPAY over a long-term period.

Direct debit usage: There is a consumer perception that direct debit is the most appropriate method when a fixed amount is due for payment. For 30% of users, direct debit is selected because it is the only payment method offered by a biller.

Mobile payments: Still in early phases of adoption, 30% of respondents are aware that you can make a BPAY payment from your mobile phone however only 1% had done so. There is an expectation that we will see exponential growth in mobile payments over the next few years.

Electronic bill presentment: The appetite for future usage of electronic bill presentment comes from those already using it. The preference for electronic bill presentment can be seen clearly here by bill type.

Paper bills: We expect consideration to move to electronic bill presentment to grow over the next 18months as nearly half of Australians have been charged for paper bills in the past 6 months. The majority of bill payers stated this will make them more likely to move to an electronic bill in the future.

BPAY View: Awareness of BPAY View is unchanged and still relatively low, but there has been an increase in usagefrom 13% in 2008 to 18% in 2009. Overall, the service performance of BPAY View continued to meet expectations with the majority of users stating they would re-register for the service if they changed bank accounts.

Conclusion: Overall, BPAY is in an extremely good position in relation to the competition, however we can't be complacent. There is an emergence of new competitors and new initiatives being launched on the market and we will work with our key partners and stakeholders to retain our existing users and capture potential new users in 2010.

Paper Savings made from the increased uptake of BPAY View

BPAY, in conjunction with Planet Ark, has developed the BPAY View Paper Saver Calculator, enabling individuals to calculate how much paper they can save by registering their bills with BPAY View. The calculator also shows how much paper and associated products have been saved since January 2007 from the total BPAY View registrations. Check out the unbelievable savings since January 2007!

• 31,495,000 sheets of paper
• 21,650,000 envelopes

This equates to a saving of:

• 4,435 trees
• Enough energy to power 70 homes for a year
• The green house gas emissions from the running of 96 cars for a year
• Enough water to fill 87 large domestic swimming pools

It is incredibly positive that Billers who offer BPAY View are contributing to these environmental savings. Registrations increased by an incredible 73% (550,000) in 2009 and the number of bill presentments also increased by 88% over this period.
*all figures from December 2009

Learn about the new training tools BPAY will offer

BPAY is pleased to announce the development of BPAY Training Program tools and materials, tailored especially to Billers needs and requirements. The new training tools and materials will be offered in the second quarter of 2010. The training will outline the benefits of being a BPAY Biller and advise them of their obligations in an easy to understand format. The new Training Program will include two modules:

• Module 1, New BPAY Billers: designed for Billers new to the BPAY Scheme. It will include a "Getting Started" section.
• Module 2, Existing BPAY Billers: For all Billers, this module will give an overview of key areas that Billers need to let their Biller Institutions know about when making changes.

Each module will include a PowerPoint presentation with a "Train the Trainer" script, Quick Reference Guides and a brief audio visual Tutorial.

If a Biller is interested in Training, please contact Gill Brown, BPAY Training Manager on 02 9646 9222.