Utilities companies will soon be able to deliver an enhanced customer experience via real time 24/7 payments and the option of staggered payments and other flexible options using the New Payments Platform (NPP) according to a new report from KPMG in collaboration with Commonwealth Bank of Australia, NPP and utilities – Transforming the customer experience, released today.
The Report provides a snapshot of the NPP ecosystem, its transformative capabilities, and the payment features and benefits it will deliver to customers in the utilities sector.
KPMG noted that the NPP is being implemented by 15 organisations – including Commonwealth Bank as one of 12 financial institutions – as well as service providers and the Reserve Bank of Australia (RBA). The firm said the platform would offer the level of control and integrity required from a trusted payment system while also opening the payment ecosystem up to allow non-traditional players to collaborate.
With a specific focus on the NPP and utilities, Cassandra Hogan, National Sector Leader KPMG Power & Utilities said that for customers of utilities companies, the NPP will mean improved efficiency and cash flows – and reduced costs.
“One of the key benefits KPMG sees for customers in the Power & Utilities sector is the potential for managing ‘bill shock’ – the instance where a large bill arrives which may be challenging to pay on time,” she said. “With the NPP, a utility can use smart meter insights – such as daily/monthly consumption – to provide recommendations on how the customer could optimise the tariff they are paying. They might pre-pay to avoid bill shock or establish billing cycles that suit their personal needs. The NPP can help in this process.”
Ms Hogan also noted that a large proportion of utilities sector customer calls into a contact centre are payments related. Any improvement in the payments system that can make it easier for customers would deliver a better experience for all, she said.
“In considering what the New Payments Platform can deliver for utilities, we are looking at how the payments process can be made flexible and smooth, how it can help customers better manage their cash flows, and how the customer experience more broadly can be enhanced.”
Taking the reduction in bill shock a step further, Mike Baldwin, Executive Director NewTech Product Initiatives Commonwealth Bank said utilities could combine smart meter readings with customers’ payment options through the NPP, including the options of micro-payments, easy pre-payments, or bill smoothing to match their pay cycles for example.
“As a utilities customer, you could pay every day for example,” said Mr Baldwin. “Likewise, if you are generating electricity via a solar system, and feeding the power back into the grid, you could be paid for that generation in real time, every day.”
Since the NPP features include greater speed of payment, simple addressing, and 24/7 availability, Mr Baldwin said it offered significant scope for utilities to create better customer experiences in tangible ways. Drawing on the NPP, utility organisations that leverage the infrastructure will be able to create new and improved customer experiences.
For customers of utilities companies, the NPP means improved efficiency and cash flows and reduced costs – benefits many consumers are already experiencing in other sectors – and indeed seeking.
Real time payments were another key way in which this could be achieved according to Brett Watson KPMG Payments Advisory Partner. Mr Watson said a lack of immediacy in payment delivery between customers and retailers in the current system leading to costly paper bill reminders, other unnecessary costs, higher call centre volumes, and further customer dissatisfaction.
“Our view is that the NPP provides significant opportunities for an enhanced customer experience while also providing productivity and cost benefits to utilities through streamlining traditional processes,” said Mr Watson. “Improved visibility of outstanding invoices is just one example of what we expect to see with the NPP. Organisations will be able to address and overcome many of the core challenges of the existing slow and unwieldy payment systems.”
Mr Baldwin said, “Customer expectation have already changed. Speed, convenience and simplicity are how people now expect things to work. The NPP can help deliver where customer expectations are – and help utilities be seen as modern, relevant leaders.”
This translates to an expectation of seamless payment options, no ‘bill shock’, and no unnecessary overdue notices or misdirected funds.
“We need to ask what can be done to support utilities and their customers to interact better, to assist in making the payments process flexible and smooth to better manage cash flow and to enhance the customer experience,” Ms Hogan.
Ms Hogan said the NPP had the potential to smooth out payments not only between the retailer and customer but also between the retailer and energy generators, other retailers and the Australian Energy Market Operator (AEMO) and other industry networks.
“Now is the time for utilities to start thinking about the customer experiences they can offer via the NPP – and how these will impact their operating model and the required skillsets of their people,” she said. “It’s a time to seize the opportunity, and understand how customer benefits inherent in the NPP can be delivered.”
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