Digital Transactions Authoritative, insightful and timely information for payments professionals
By John Stewart
Nearly a year after its launch, a service at U.S. Bank that lets customers enter biller details and pay bills by snapping photos of the bills with a smart phone is helping the banking giant make big gains with mobile users, a critical demographic group, a U.S. Bank executive said Wednesday.
Six months after rolling out the service early in March last year, the bank had logged a 25% increase in mobile bill payers and a 64% jump in the number of bills paid via mobile device, according to Niti Badarinath, senior vice president and head of mobile banking and payments at the Minneapolis-based bank. Badarinath spoke at the Mobile Payments Leadership Summit, a conference in Orlando, Fla.
U.S. Bank was the first major financial institution in the country to introduce what is known generally as mobile photo bill pay. “Photo bill pay to us is a big deal,” Badarinath said. “Our customers love it, and we think it’s an amazing thing.”
The service has helped U.S. Bank gain customers among a key customer group, younger consumers who rely heavily on mobile devices for everyday functions. Once signed up, these customers tend to stay with the bank. “Our strategy is to get more customers to enroll in what we call ‘sticky’ transactions like bill pay,” Badarinath said,
The service also lets the bank meet customer demand for remote mobile-payment services, like bill pay, in a new way. By contrast, demand for so-called proximity payments, also known as mobile payments in stores, is weak. “The reason we focus more on remote payments is because that’s where our customers are,” Badarinath told the audience.
The bank’s mobile photo bill-pay service relies on software developed by Mitek Systems Inc., a San Diego-based company that pioneered remote capture of checks with mobile devices and has since introduced technology like photo bill pay that also makes use of smart phone cameras. Transactions are processed by Fiserv Inc.’s CheckFree unit.
To use the service, customers snap a photo of a bill. The software captures information from the image to fill in biller fields. The customer can simply store the biller data for later payments or elect to pay the bill. The entire transaction takes three to seven seconds, according to Badarinath.
Customers value the service’s ability to capture information that would otherwise require much tedious typing on a small screen, he adds. This is especially true among the younger prospects the bank has targeted. “Younger, higher-income customers, who we need, would use mobile photo bill pay,” he said.
Since U.S. Bank rolled out the service, BBVA Compass Bancshares Inc., First Bank Colorado, and processor Allied Payment Network Inc., which distributes the service to smaller financial institutions under the Picture Pay brand, have adopted the Mitek technology.
