What consumers say is most important when receiving payments in 2022 may surprise you: Choice. Yes, speed and convenience weren’t far behind in Onbe’s 2022 Future of Payments Survey, but consumers’ growing preference for personalized payment experiences resonated clearly. As payment preferences continue to diversify, brands need to build disbursement experiences that reflect this diversity by supporting a variety of payment choices and use cases.
Why (and How) Did Recipients Receive Disbursements Last Year?
2021 showed unprecedented growth in the volume of disbursements paid to consumers, largely due to government stimulus payments. However, our survey respondents received disbursements for a variety of reasons, including consumer incentives, refunds, and compensation. While legacy modalities remain prominent, digital preferences are on the rise, suggesting that payers need to expand payment choice in response to demand for fast, flexible, and personalized payment experiences.
Should Disbursements Be Digital-First?
Our survey found that over half of consumers believe digital payments are the most secure, and almost three-quarters prefer to make payments using digital methods. Many consumers also plan to use cash and checks less frequently in the future. Noncash payments represent an array of options ranging from credit cards and physical prepaid cards to peer-to-peer (P2P) payments and virtual cards that can be spent online or added to a mobile wallet for in-person spend. Building a digital-first disbursement strategy, such as a payment program that offers recipients their choice of payment method, enables brands to push popular picks such as physical or virtual cards while also supporting traditional payment form factors.
Know Your Audience
Our survey found that payment preferences and adoption of newer digital paytech varied by age group. For instance, nearly one third of those ages 18 to 24 plan to use mobile wallets more in 2022 compared to just 14% of those ages 45 and older who say the same. While significant, this generation gap is not as large as might be expected. The pandemic has accelerated the widespread adoption of newer paytech that enables experiences such as contactless payments. So, understand that younger demographics may be more open to making and receiving payments via digital channels, but don’t underestimate older consumers’ willingness to select these modalities when offered the choice.
The Value of a Tailored Disbursement Strategy
While it’s helpful to tune into general shifts in consumer behavior, the mix of form factors that makes sense for your brand will depend on your industry, organization, recipient demographics, and use cases. Utility customers due a refund are likely to exhibit a range of payment preferences more reflective of the general population than customers signing up for a brand’s rewards program. Gig workers may have different payment needs than sales representatives participating in an incentive program. And enabling a wide range of spend channel options, such as the ability to add virtual cards to a mobile wallet for one-touch in-app purchasing, may be more critical in some verticals and use cases than others.
In addition to meeting recipient needs, businesses will benefit from aligning their disbursement strategies with their sales and marketing goals, such as driving spendback and brand awareness. For example, delivering a consumer incentive via a branded card package or digital experience can boost brand affinity and guide customers toward options for spending their funds directly with you or with a partnering retailer. And whatever challenges your industry is currently facing, from concerns about payment fraud to a shortage of administrative labor, Onbe is here to help. Together, we’ll create an efficient and scalable disbursement strategy that is tailored to your business needs and goals while delivering on your recipients’ choices.
Want to learn more about what consumers expect from payment experiences now and going forward? Download Onbe’s 2022 Future of Payments Report.
You can also drop a line to our sales team to learn more about our solutions and how other businesses in your industry have partnered with Onbe to optimize their disbursement programs.