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An Empirical Analysis of Bill Payment Choices

Anneke Kosse

Staff Working Papers from Bank of Canada

Abstract: The aim of this paper is to examine which payment instruments Canadians use for paying bills and to assess the factors driving their bill payment behaviour. I use 2019 survey data collected among over 4,000 Canadians and estimate a set of binomial and multinomial regressions to assess the factors influencing consumers' use and perception of different bill payment options. I find that there is no single dominant payment method for all consumer groups: demographics, financial situation, new technology adoption and POS payment habits play a significant role in the usage of bill payment methods as well as in consumers' stated reasons and barriers of use. Moreover, I demonstrate that consumers' bill payment behaviour strongly varies by bill type. The conclusions are useful for policy discussions on how to encourage a migration away from paper-based payment methods and how to (re)design a retail payments system to accommodate end-user needs.

Keywords: Bank notes; Econometric and statistical methods; Financial services; Payment clearing and settlement systems (search for similar items in EconPapers)
JEL-codes: D9 G2 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2021-05
New Economics Papers: this item is included in nep-pay
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Handle: RePEc:bca:bocawp:21-23