Consumers Tiring of Slow Payments, Studies Find

Consumers are losing patience for slow deposits, sluggish paper reimbursements, rebates via snail mail and other time-consuming payments processes, according to a new study by Meta Financial Group.

The survey of more than 1,200 U.S. adults found that many consumers were more willing to transact with companies that have instant and easy-to-use options for spending, receiving and moving money. According to the data, 39% were more willing do business with companies that offered direct deposits they could receive in a few days, and 47% were more willing to do business with companies that offered direct deposits in minutes. About a quarter (24%) even said they would even be willing to pay a small fee to get their rebates, refunds or credits within minutes.

It also found that 31% were less willing do business with a company that makes payments via check that would take weeks to receive.

“Faster payments meet consumer demand while providing the opportunity for business growth. It can be a cost effective addition, too, as many consumers would be willing to pay a small fee to receive faster payments,” Meta EVP and Head of Payments Sheree Thornsberry said.

Consumers are also increasingly open to getting company refunds or reimbursements via P2P platforms such as Zelle, PayPal or Venmo, according to the data. PayPal was the preferred method for 17% of the respondents; 4% preferred Zelle and 3% preferred Venmo.

“Today’s culture is increasingly on-demand, from social media to ridesharing. But the study confirmed these expectations are spilling over into B2C payments. Thirty-six percent of Americans who had a preferred method of payment chose one over the others due to convenience. Eighteen percent selected their preferred method because it provides quicker access to funds,” the company noted.

Meta Financial Group’s survey landed on the same day as a survey by TD Bank of 498 payments industry professionals. In that survey, 26% of respondents said their companies did not yet have any accounts payable automation, and only 22% of the respondents said their organizations planned to participate in real-time payments within the next year.

Part of the issue was that payments capabilities are changing faster than organizations can handle, according to TD Bank Head of Corporate Products and Services Rick Burke.

“The U.S. has been behind several other countries in implementing faster and real-time payments but is gaining momentum,” Burke said. “Dialogue about payments is increasing among banks, lawmakers, policymakers and practitioners, and this is likely to drive faster change. It will be interesting to see how faster payments evolve over the next few years, especially with the Federal Reserve’s announcement that they will develop a new real-time service called FedNow.”

“Payments professionals in the U.S. note they still have not fully identified a use-case for and implemented real-time payments, according to survey results. More than half (56%) of participants said it will take at least one year, if not more, to implement real-time payments within their company,” the study also noted.