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Working Paper
Consumer Payment Choice for Bill Payments
Why do US consumers pay their bills the way they do? Using data from a recent diary of consumer payment behavior, we find that the type of bill consumers are paying and how they are paying (online or automatically) are important factors in determining the payment method, in addition to the dollar value of the bill and the demographic and income profile of the individual who is paying. In contrast, dollar value and demographic attributes are found to be the most important factors determining the payment instrument chosen for purchases. Consumer choices for bill payments are somewhat ...
Briefing
When Paying Bills, Low-Income Consumers Incur Higher Costs
Low-income consumers are more likely to pay bills using costlier payment methods, even when they have access to cheaper bank account-based methods. Digital exclusion, cash flow constraints, and lack of trust in or familiarity with electronic payment methods may explain low-income consumers’ reliance on costlier bill payment methods.