Digital Payments Streamline Class Action Settlements

80% of claimants say digital payouts would be more convenient than checks

Class action lawsuits are on the rise—but the settlement process hasn't caught up with modern payout experiences, according to Onbe's Winter 2024 Legal Services and Class Action Payments Survey. We discovered that claims administrators can simplify settlement payouts by:

• Replacing checks with fast digital experiences
• Providing popular options, including paying by app or virtual card
• Communicating clearly at the time of payout

Dive into the findings from our survey to understand the settlement experience from the claimant's perspective—and uncover ways to reduce the cost, risk and complexity of your payout processes.

Download infographic

The State of Class Action Settlement Payouts

Checks remain a common way to disburse class action settlement funds, but they pose challenges for both claims administrators and class members.

For administrators, checks are costly, adding up to around $8 each when totaling processing fees, postage and other expenses. Checks are also vulnerable to fraud and typically have lower delivery rates than digital and electronic payment methods. A high volume of uncashed checks leads to a steep escheatment burden and can increase the costs and risks of unclaimed property administration.

For class members, checks are often less convenient than modern payment methods. Options such as virtual cards, Paypal, Venmo and other popular digital payment types offer a more seamless payout experience, making it easy to access and spend settlement funds.

Offering Class Members Their Choice of Digital Payout Methods

In Onbe's research, over half of class members receiving a settlement payout did not get to choose their preferred payment method. When administering settlement funds for consumer class action lawsuits, offering choice can improve claimant satisfaction, helping to ensure class members enjoy a smooth payment experience.

A digital-led class-action disbursement platform can make it easy to meet diverse payment preferences. Instead of defaulting to a standard check, claims administrators can provide popular payment options, including both digital and traditional choices.

Simplifying the Settlement Disbursement Process

From overseeing complex claims to fielding class member inquiries and handling tax reporting, settlement administration is a challenge that calls for support from a managed disbursements provider.

With our proprietary technology platform, dedicated team and extensive experience, Onbe makes class action settlement payments more seamless for administrators and recipients, alike. We manage the entire process of disbursing settlement funds, from making claim payouts to providing ongoing program support to help you stay compliant. Recipients appreciate receiving their long-awaited settlement administration money via their preferred digital payment methods for convenient and flexible spending.  

Looking for distribution services to simplify the settlement administration process? Learn more about Onbe's solutions.