During a time of uncertainty post-pandemic and with rising prices during a cost of living crisis, payment channel provider allpay Limited sought to understand how people are managing their money and paying their bills.
Via a survey in September 2022, allpay questioned 1,001 from all areas in the UK. The payment provider conducted further research earlier in 2022, which it used to compare the latest results with. The survey was conducted by TLF Research and found reduced consumer confidence in paying household bills, among other trends.
The results show a slight decrease in the number of social renters that were confident in paying their household bills. However, a vast majority (74.9 per cent) remain confident despite the existing cost of living crisis.
Reliance on cash continues to exist
Interestingly, the number of social renters that had access to a bank account also lessened from earlier in the year. The percentage rose from 1.4 per cent to two per cent in less than a year. The trend showed
allpay also found a continuing trend of a reduction in the number of people dependent on cash. However, a significant portion of those surveyed still relied on cash to make bills. Specifically regarding social rent payments; 1.1 per cent of these were made utilising cash. Furthermore, 6.9 per cent of water bill payments were made using cash.
The number of people that continue to use cash remains prevalent despite an overall downturn in the proportion of those that are cash-dependent. The payment provider explained that cash payment points are important and need to remain to support those such as the unbanked. Over half of social rent payments (63.6 per cent) were made at PayPoint, Post Office or Payzone stations.
Responding to the cost of living crisis
As part of the survey, respondents were asked if the rise in the cost of living has changed how they made payments. Only 15.1 per cent of people said that they had made a change, leaving 84.9 per cent of people not adjusting their habits. Of those that did choose to make a change, 37.1 per cent of people explained that they now use methods to track spending accurately to help with budgeting.
48.1 per cent of respondents suggested that payment reminders would make paying household bills easier. They also suggested other methods such as budgeting tools, self-service automated payments and instalment plans would support them.
This highlights that people feel as though spreading payments apart would help them to better manage their money. The results also hint at an increased need for further support when planning to make payments. This shift in attitude likely comes due to the recent rising costs of bills.
Direct Debit retains the top spot
Direct Debit continued to be the most popular choice of payment method, as allpay also found earlier in the year. The payment method had an average take-up of 45.8 per cent across all bills. This saw an increase of 10.9 per cent from the earlier survey.
Around 68 per cent of people chose to pay their internet and phone bills via Direct Debit. The payment method was also chosen by 62.7 per cent of those paying electricity bills.
Suggesting that a rise in Direct Debits will continue is a fall in the number of debit card payments used. While the method remained the second most popular, it fell by 11.3 per cent since February to only 16.2 per cent. The reduction in debit card payments suggests a large number of people selecting direct debits in order to better plan and manage finances.
Image and article originally from thefintechtimes.com. Read the original article here.