Utility Companies & the Road to Mobile Commerce

by , Dec 19, 2013, 5:01 PM
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While many consider point of sale a key if not the key area of mobile payments, there are other aspects of payments that seem to growing.

There is, of course, is peer-to-peer mobile payments, when someone wants to exchange cash with someone else, which can be done by various apps like Venmo.

But then there’s the routine aspect of paying bills and it looks like utility companies are starting to jump in on the action.

In a recent survey of utility company professionals by mobile payment company Check, a quarter (25%) of utility companies offer mobile payments while a majority (51%) said they  wanted a mobile bill payment solution for customers.

And there certainly is room to grow, with 75% of utilities not yet offering a mobile payment solution. The reasons utilities want mobile payments varies, based on the survey:

  • 24% -- Decrease billing costs, including the cost of paper bills
  • 18% -- Increase customer engagement
  • 7% -- Collect money faster and optimize cash flow

However, there are also various things holding adoption back, according to the survey:

  • 47% -- Vagueness/uncertainty about their mobile strategy
  • 29% -- Lack of IT resources/low IT priority
  • 17% -- Budget
  • 7% -- Security/compliance concerns

Despite some potential bumps in the road, Check founder and CEO Guy Goldstein sees payments to utilities as a major growth area.

“A big trend we see is the utility companies moving into mobile, since they want their customers to pay by mobile,” says Goldstein. “Mobile is at the top of the agenda for utilities.”

Interestingly, Goldstein says most of the company’s 10 million U.S. customers pay by the Check smartphone app rather than by tablet, with an even split between Android and iOS, with bigger current growth on Android.

It just may be that categories such as transportation and utilities become the area where masses of consumers learn to pay by phone.

It’s not exactly mobile commerce at retail, but it is part of emerging new mobile payment behavior.

 

2 comments on "Utility Companies & the Road to Mobile Commerce".

  1. Paul Robinson from Viridian Development Corporation
    commented on: December 19, 2013 at 6:54 p.m.
    Utility companies have been heavily regulated monopolies for decades, some as much as a cemtury. That makes them extremely conservative as far as adoption of new technological developments. Most have been dragged, kicking and screaming, into the world of competitive providers. So it's understandable that public utilities have been very slow to move on new ideas and new ways to do business. New York's Con Edison still offers steam heat and DC power, very reliable services that have been around since the 19th century. But nobody has seen fit to upgrade the grid system that supplies power because that's going to cost money and the current infrastructure is good enough, and besides, where can the customers go? There's no other wire network available as a choice to obtain power from.
  2. Chuck Martin from Chuck Martin
    commented on: December 20, 2013 at 7:05 p.m.
    Good points, Paul, though encouraging to see them moving toward mobile payments.

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