Posted by Alison Arthur on 25 Nov 2019
The holidays are upon us and seasonal retail sales are expected to be strong. A recent forecast from the National Retail Federation predicts growth of 3.8 to 4.2 percent over 2018 holiday retail sales.
This is also the time of year when consumers might need more flexibility when it comes to directing their dollars. For example, funds that are earmarked for loan payments might be useful to help make holiday-related purchases. In these situations, some customers might want to take advantage of a skip-a-payment option for their bill payments.
What is skip-a-payment?
Skip-a-payment allows customers to do just that, take a month off from a regularly scheduled bill payment and reserve that money for other purposes. The customer typically needs to have their account in good standing to take advantage of this option, if it’s offered by their biller.
How does it work?
Billers typically offer skip-a-payment for a limited time period (for example, the holiday season might include November, December, and January) and assess a fee for using the service. Customers pay the fee instead of making the bill payment and can direct that cash toward other expenditures. The skipped payment is typically tacked on to the end of the loan, thereby extending its life.
Who offers skip-a-payment?
Billers may or may not choose to offer skip-a-payment depending on a variety of factors including the nature of their business, its payments operation, and the types of loans they service. Billers can begin the conversation with their electronic bill presentment and payment (EBPP) solution provider to discuss their options for offering skip-a-payment to their customers.
The Bottom Line: Skip-a-payment can be a helpful option for cash-conscious consumers during the holiday season. It’s relevance to a specific business will depend on a variety of factors including customer demand, operational considerations, and the ease of implementing via an EBPP solution.