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 Paying Bills Online – An Idea Whose Time Has Come You’ve probably shopped online. You may even have paid a specific bill directly online to a creditor such as the phone company or a charge/credit card issuer. But are you ready to join the growing number of people who view and pay most of their bills quickly and easily online with the help of a payment service that consolidates and processes those bills? This service, known as Electronic Bill Payment and Presentment (EBPP), has been around for a while, but now is enjoying more and more consumer interest. Today, participation is growing, thanks to the fact that more consumers are computer-savvy, there have been significant advances in electronic payment technology and an increased level of confidence in data security. According to the Yankee Group, a Boston strategic planning firm, consumers are showing more interest in EBPP than they did last year, when only 5.1 percent surveyed reported using this payment method. A growing number of respondents to the group’s annual Technologically Advanced Family (TAF®) Survey mentioned EBPP’s time savings and convenience. Now, the Yankee Group estimates that, based on trends they have seen so far this year, the percentage of consumers paying online should grow to 8.7 percent in 2001. How EBPP Has Evolved Originally, to pay online, a consumer had to log on to the individual Web sites of creditors with electronic billing, find out the account balance, and authorize payment through his or her bank. Consumers who particularly liked this way of paying bills were frequent travelers who needed to transact payments while away from home, high-volume charge and credit card spenders, and people who were already accustomed to charging online. The next step in the industry’s evolution was the development of several major third-party consolidators with the capability to aggregate all of a consumer’s household charges, allow consumers to view multiple bills, and then process the payments electronically. Today, the top 1,000 billers in the United States offer electronic billing. Among them are phone companies, large charge/credit card issuers and regional utilities. Registering for a Service Payment processors offer their bill consolidation services independently or partner with a financial services company, bank or card issuer. There is usually a basic monthly charge for a set number of bills, although the consumer can add extra bills for a small additional fee. The new customer tells the company which bills he or she wants to manage online. When a bill is issued, it is posted on a password-protected page for the consumer to view and authorize payment. Some services offer automatic payment of certain regular bills; for example, a phone bill that doesn’t exceed a pre-determined amount. Or the participant can arrange for the service to pay a one-time bill. Some companies also offer, for a fee, a record of the whole year’s transactions on a CD-ROM to use for tax preparation. November 15, 2001
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