Posted: September 11, 2026 | Updated: September 11, 2026 at 2:43 PM
For most American households, online payment is the new default. However, users still leave payments unfinished. When users click the payment link but do not finish the payment, billers, utilities, and government agencies lose potential income and incur the cost of increased call center usage. An unfinished payment will not magically disappear; it will generate late fees for the resident and possibly even cause a service disruption.
The word abandonment indicates that payment quitting happens at a specific, discrete moment. However, new research shows that abandonment happens over multiple steps. Consumers begin the payment online, but an unexpected fee, a login they cannot remember, or an awkwardly located field on a payment form that requires a piece of information the user does not have leads to payment abandonment. All of these things can cause payment abandonment individually. Collectively, they explain why adoption of online payment systems runs ahead of actual payment completion.
Eighty percent of online bill payments in the United States bypass bank bill-pay systems and go directly to utilities, government agencies, or service providers. This was only 62% in 2010. It has also become easier to automate bill payments. Nearly half (44%) of consumers had automated bill payments in 2026; only 40% had it in 2023. People prefer automation because it reduces the need for the repeated “decision” to log in and pay a bill, which is often the point at which payment is skipped.
These automated payment systems reduce the burden of “decision fatigue” to bill payment and also automate the payment so that consumers do not face the moment of deciding whether to pay the bill and therefore skip it. The automation of payments also eliminates the mailing delay. Financial stress is widespread, as reflected in the 36% of consumers who regularly report anxiety over bill payments and the 29% who do not have $400 saved for emergency expenses.
In the second quarter of 2026, Datos Insights’ Retail Banking and Payments practice surveyed 4,057 U.S. consumers for its 2026 bill payment methods report, covering a market of 17.1 billion bills totaling $5.2 trillion. The size of this dataset makes their biller-direct and recurring payment figures the most useful findings.
It is their dataset size that allows these figures to be considered reliable benchmarks as opposed to being a single organization’s case study. The report also breaks bill payment method adoption by generation, and notes a significant divide between Gen Z and baby boomers on both method and channel. This divide matters to any resident portal that has to serve every generation.
The user experience problems with government payment systems and online payment systems for utility bills are the same as with retail checkout, even though payment with government systems or utility bills should be much simpler. A resident who pays for water is not checking the competition or looking for a deal. They just want to pay the bill and leave. When the system takes too many steps, the result is the same as with retail checkout – residents abandon their task.
In its September 2025 report, Baymard Institute elaborates in detail on the reasons behind customer payment checkouts that do not complete successfully. Based on their report, 40% of all U.S. online shoppers attributed abandoning an order to payment checkout processes that charged them last-minute fees. 19% of online shoppers abandoned an order because they didn’t trust the site.
18% of shoppers felt forced to create an account prior to being able to complete a payment. 17% of shoppers blamed abandoning an order on a complicated and lengthy checkout process. Another 17% attributed abandoning an order to site errors or crashes. 12% of all shoppers complained about having to complete the payment checkout process only to find out the total amount due later in the process.
Baymard Institute’s benchmark data gives a number to this final complaint. The ideal checkout process consists of 12 to 14 form fields. The average checkout process in the U.S. is longer and requires 23.48 form fields. Every additional field is an opportunity for an online resident to stop the checkout process or be distracted and come back to complete the payment at a later time.
While a retail shopper can leave for a competitor, public sector portals have no alternative provider. If a portal for a county tax payment or a utility bill is difficult to navigate, the resident has no other choice but to call or go to the office in person. As a last resort, the resident will miss the payment altogether.
A survey conducted by Deloitte shows that 55% of respondents in the US said they would prefer to interact with the state government online and 50% said that preference applies to the local level. However, actual use of online government services is only at 23%. Among the respondents of the survey satisfaction was reported to be 78% for online voter registration, the highest satisfaction rate.
Close behind, online services for motor vehicle documentation, public health, and transportation services scored 60% satisfaction. The other services, such as public housing, child and family services, and business licensing, scored low satisfaction around 50%, and these services tend to have the most complicated payment and application processes.
SimpliGov has identified a gap caused by a particular structural issue. Many agencies use a separate vendor for a forms platform and a payments platform. For payments that are processed on a separate, disconnected site, residents do not have visual continuity and do not know if they are still in a legitimate government process. Separating systems interrupts more than one transaction.
The broken connection with two systems creates a lack of trust in the agency, and that lack of trust has consequences with the following bill cycle. SimpliGov has identified an additional issue on top of the trust issue. Residents who live in rural and suburban areas, where connectivity is limited, already experience more friction than urban residents. If those residents are required to navigate two separate systems, that puts the payment at risk.
The issues in a resident payment portal tend to build gradually. They are more like a series of small incremental steps rather than one large issue.
The Third Annual 2026 State of Online Payments Report by InvoiceCloud is based on a commissioned survey of bill payers in the United States. The report found that a third of respondents avoid digital payment methods altogether due to a lack of options that are convenient and easy to use. Of digital payment method users, one in four need to look up their login credentials to pay a bill every time. Another 22% said that payment reminders are the main reason they fall behind.
All of these issues can have a negative impact on a biller’s ability to collect. One of the most common reasons residents let payment reminders lapse is that they begin to enter payment information, get pulled away, and close the browser to pay at a more convenient time.
Eliminating the requirement to create an account as a prerequisite to making a payment solves the same problem that Baymard studied in retail: the percentage of residents who abandon the payment process increases if the residents feel as though they are being forced to create an account.
InvoiceCloud’s other survey, published in 2025, found that for the first time in the survey’s history, payments initiated by mobile wallets surpassed payments initiated by the Automated Clearing House (ACH). The survey reported that if the payment system is designed for mobile use/payment, the completion rate also improves.
Building a resident payment portal that works solely on desktop loses segments of the intended audience before a single design flaw is even detected by analytics.
The most recent Pew Research Center broadband tracking, January 8, 2026, shows that 16% of US adults use a smartphone as their only means of Internet access. This means that they have a smartphone but do not have home broadband. Three-quarters of US adults do subscribe to home broadband. This 16% is not evenly distributed. According to Pew Research Center, the dependency on smart devices increases among adults younger than 30 years of age, Hispanic and Black adults, adults from low-income backgrounds, and adults with less formal education.
These groups overlap heavily with utility assistance program recipients and public housing residents. A payment interface that takes a long time to load on mobile, or a payment form that was designed for desktop, will result in losing the residents who are either unable to place the call during business hours or unable to make a payment in person.
According to the payments company InvoiceCloud, approximately two-thirds of the US adult population used their mobile devices at one point to pay a bill in the last year and mobile is now the leading payment channel for this population, growing to be the choice of 29% of billpayers in 2024 from 26% in 2023. Treating mobile as an afterthought is treating the leading payment choice as an edge case.
Having residents enroll in the system as ‘paperless’ is one of the clearest predictors of which residents will consistently pay their bills online. Barriers to this are limited enough to be resolved.
According to InvoiceCloud’s 2026 report, 65% of customers receive at least half of their bills digitally. However, 7% of customers have not taken any initiative to go paperless. Of that group, 35% want a paper bill. 23% are unsure of how to go paperless. 19% of customers have concerns about online bill payment safety. Finally, 12% of customers are unsure of how to enroll. This is an interface concern and is the easiest of the issues to resolve.
If enrollment options are made more apparent, for example, at the time of payment, it is a fairly easy issue to resolve. One incentive for paperless billing is the environmental angle. Frame environmental concerns about paper as a nudge. In 2018, 20% of responses to why customers choose to pay digitally cited paper concerns, compared to 2017, when only 10% of customers cited them.
Building a new resident portal is not the solution to payment abandonment. The solution is to eliminate the steps that have been previously identified in the data. The data shows that having a guest checkout option removes the barrier of forced registration that Baymard found affects 18% of abandoners. Making the total amount due visible, including any convenience fee, eliminates the barrier of extra costs that affects 40% of abandoners.
Reducing the number of form fields to the range of 12 to 14 identified by Baymard reduces the length of the flow enough to have an impact even on a slow mobile Internet connection. The trust gap that SimpliGov found when analyzing public sector portals is addressed by integrating the payment form and the payment processing system as a single system.
There is no compelling evidence to suggest that users avoid online bill payment systems because they reject the concept of paying bills online. The available data indicate the opposite; users prefer digital payment systems, and biller-direct payment volumes have been increasing since 2010. The issues that cause people to abandon payment systems are relatively minor design choices such as making users create accounts, hidden costs, long forms, and designs untested on the connections residents use.
Each of these issues has known solutions that do not require waiting for users to change their behavior. According to Baymard Institute, the expected value of better checkout design is a 35.26% increase in conversion rate for large sites. Conversion rates of utility payment and government payment portals have not been reviewed against this benchmark.
Baymard Institute’s research says 40% of online shoppers abandon carts because “unexpected costs” pop up.
It almost certainly does. Baymard Institute’s research shows that 18% of online shoppers abandon the checkout because of mandatory account creation.
A 2023 Deloitte study shows that residents like the idea of online access to government services at 55%, but only use digital services at 23%, which is attributed to cumbersome government websites and services.
In its 2026 report, the Pew Research Center found that 16% of adults only use the internet on mobile devices, so not having a mobile device-friendly payment portal could effectively shut that group out.
