Energy service providers across the U.S. are struggling with the consequences of late and delinquent utility payments, while service shutoffs become increasingly endemic for millions of people nationwide. Even more pressing than the staff time and resources caused by chasing after delinquent payments, lack of essential utilities like air conditioning in the summer or heat during the winter can become life-threatening.

Alarmingly, a significant number of Americans are at risk of losing access to these services due to missed or forgotten bill payments. In 2022 alone, energy providers disconnected electricity for an estimated 3 million customers who had failed to settle their accounts.

Utility organizations can have a hand in curbing the disconnection crisis and reestablish regular, timely payments. But first, service providers must identify common reasons for missed payments so they can deploy solutions to prevent accounts from going delinquent. Let’s explore some of the prevalent reasons behind unpaid bills and corresponding strategies that utility organizations can implement to guide customers back onto the right payment path.

1. Customers are Unaware Payment is Due

One of the biggest challenges utilities contend with is prompting payments from customers who aren’t aware payment is due. Whether it’s forgetfulness or some other circumstance that’s keeping customers in the dark, communication is critical.

Payment reminders are key to encouraging regular, timely payments. Ideally, reminders should be branded so it’s clear which organization they’re from and include important information like the amount due and how customers can immediately pay their balance. Plus, InvoiceCloud data shows customers respond best to second and third notifications. Enable multiple reminders to increase your chances of receiving payment before the due date.

2. Checks for Bill Payment are Late or Stolen in Mail

Traditional mail is not the most reliable option for sensitive communications, like bills or their corresponding payments. Besides
the slow pace of this delivery method, the U.S. Treasury reports check fraud has increased nationwide by 385% since the pandemic.

To avoid the dangers of late or stolen payments by mail, it’s important to educate customers on the dangers of using checks for payment. Promote digital payment options in myriad ways, including on paper bills and envelopes, to encourage online adoption. Research shows those who prefer writing checks are largely open to using self-service payments like automated phone options (also known as IVR) and mobile wallets, but billers must actively promote these digital choices to successfully discourage check use.

3. Customers Cannot Access Computer or Internet

Online payments may be a convenient and popular option for many policyholders, but using computers for bill payment is not an accessible option for all people. More than 14 million households across the U.S. don’t have internet and research has found that populations like non-English speakers and the unbanked have limited access to computers.

The PEW Research Center found 97% of Americans have mobile phones, including the unbanked population. To cater to customers who prefer using a mobile device for bill payment, organizations should promote mobile wallets, use online portals configured for an optimal smartphone experience, and offer automated phone payments (also known as IVR) or options to pay in cash at retailers.

Get the Full Payments Delinquency Roadmap

For more common causes of late utility payments and strategies service providers can implement to overcome these challenges, get the full Payments Delinquency Roadmap. This free ebook will take you through the twists and turns many customers experience when trying to keep their essential services operational.