Two in five UK adults have missed a utility bill payment in the last six months according to new research from Moneyhub, highlighting the need for more flexible ways to pay.
In its latest financial wellbeing survey, Moneyhub revealed that 24 per cent of UK adults have missed a payment of some kind in the last six months – with 41 per cent of this missing utility bills.
Meanwhile, over 77 per cent of respondents felt anxious when expecting bills to arrive or be paid, with utility bills causing consumers the most concern – as 51 per cent cited them as the bill type that causes them the most anxiety.
Escalating utility prices in the UK, combined with the wider cost of living crisis, have become a significant concern for consumers, with households grappling with the daunting challenge of managing their monthly budgets. The size of the issue is exemplified by Ofgem figures published in December (2023), showing that the UK consumer energy bill debt had hit a record £3billion.
Of the various types of utility bills, energy bills unsurprisingly emerged as the most stressful for consumers, with 41 per cent saying they made them the most anxious. This was followed by water bills (14 per cent) and broadband payments (10 per cent).
Searching for solutions
While the findings present the financial landscape in the UK in a dim light, Moneyhub explains that solutions do exist that enable utility companies to support their customers – particularly those who regularly struggle with payments.
When asked what would help them manage their money or reduce instances of missed payments 38 per cent of UK consumers said that choosing the day of the month Direct Debits are taken would make a difference.
A warning before payments are expected (28 per cent) and better oversight of their incomings and outgoings (27 per cent) were also key solutions.
Seventeen per cent also revealed that the ability to pay bills weekly rather than monthly would help them manage their money. The same proportion of respondents are paid on a weekly basis, indicating that such a change could be truly transformative for that group.
Open banking and open finance payments could provide these types of flexible solutions for customers. With open banking and open finance payments technology, the provider can much better support the consumer by preventing situations when they are blindsided by an unexpected price increase or payment and at the same time making it very easy for the customer to pay or transfer funds.
Tailoring solutions to the needs of customers
Mark Munson, MD of payments at Moneyhub, comments: “Missed payments are causing significant concern for UK consumers, with utility bills the number one culprit. With energy bills high, there is a real worry that this problem will only worsen without intervention.
“Fortunately, there are technologies that utility providers can adopt to improve their offerings to customers and better support when that customer is showing signs of distress. Often customers just need a little extra flexibility to help them get back on their feet, and with open banking and open finance, providers will be able to identify those struggling and be able to offer them individualised solutions.
“Utility businesses can benefit too by offering alternative payment options tailored to the specific needs of their customers. Companies that offer choice and more control over how consumers pay will reap rewards in improved consumer loyalty, reduced churn and increased customer satisfaction.”
Image and article originally from thefintechtimes.com. Read the original article here.