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Electronic Bill PaymentElectronic Bill Payment or eBilling is the electronic delivery and presentation of statements, bills, invoices and related information that is sent by a business to its customers. Some of the more advanced Electronic Bill Payment systems permit customers to electronically settle payment for the goods or services. eBilling is also referred to as EBPP (Electronic Bill Presentment and Payment) or EIPP (Electronic Invoice Presentment and Payment). Organisations today are looking for ways to harness technology to reduce costs. Electronic Bill Payment has the potential to reduce costs in multiple areas, while at the same time improving the overall customer experience. Electronic Bill Payment in its simplest form is the delivery of information to customers and other stakeholders directly to their inbox. With more and more people online every day and a large majority of them reporting that they spend a majority of their time managing their email, delivering information to the inbox is one of the most efficient and effective ways to communicate with your customers and stakeholders. This is not a replacement to your web strategy, but a complementary approach. Electronic Bill Payment is a common form of online bill presentation and processing of payment transactions. Quick Electronic Bill Payment Jumps:
Methods of Electronic Bill PaymentThe Electronic Bill Payment method of billing and collecting can take two distinct forms: direct and consolidated. Direct Electronic Bill PaymentThe direct form of Electronic Bill Payment is a one-to-one transaction structure, whereby a company does the billing itself through its own website or another company's site. It's not the website that matters so much as the company doing the billing. A good example of the direct form of Electronic Bill Payment is a credit card company's website, which offers online payment for debtors' accounts. A user can log on to the website and schedule a credit card payment via banking information already entered. Consolidated Electronic Bill PaymentThe consolidated form of Electronic Bill Payment involves a sort of electronic collection agency, which does billing for a group of companies and then presents those bills to an individual customer for payment. The focus is on the many-to-one relationship, with transactions conducted via a website. An excellent example of the consolidated form of Electronic Bill Payment is online bill payment. Many of the larger financial institutions offer online bill payment for their customers. A user can, with several clicks of a mouse and a few keystrokes, pay a large variety of bills, such as the phone bill, the electric bill, the car payment, the rent, the medical bills, and the ISP bill. Push vs. Pull Electronic Bill PaymentHistorically, most companies present bills to the
customer via a Web site, using one of the models already
discussed. Others offer customers the option of paying
directly via email. For these billers, the question becomes:
Do you "push" the Electronic Bill to your customer in an email or
"pull" her to a Web site? Current "Pull" methodologies, designed to direct a user
to a website has resulted in adoption rates of less than 10%
across most industries. The primary reason for the low
adoption rates is the requirement of the user to "Take
Action" to be Pulled, or directed to a website. Once on the
website, the user is then required to remember yet another
user name and password and potentially navigate through
numerous screens to reach their desired destination. And
with many consumers still using dial up access, the
challenges of the "Pull" model are even higher. These
hurdles have resulted in user inertia, and the disappointing
adoption rates. By "Pushing" the information directly to the
user's inbox, adoption rates increase to over 40% in a B2C
environment and over 80% in a B2B environment. Adoption
rates at this level will result in massive cost savings in
postage, printing, paper and the personnel and overhead
costs associated with your mailroom operations. What are the Benefits of Electronic Bill Payment?The introduction of Electronic Bill Payment has enabled many large-volume billers to reduce costs associated with billing their customers (printing, paper, postage). These cost reductions have played an important role in these billers’ ability to maintain a competitive edge. Electronic Bill Payment Benefits for Billers:
1. Reduced Call Center Volume- A wide variety of self help tools allowing customers to communicate with you via email. Included are simple tools such as change of address information that customers can deliver to you electronically, rather than by calling your call center. This will reduce your costs but will also add convenience to the customer who would rather not have to take time from their busy schedule to call you. They would much rather send you an email at their convenience. In addition to such self help tools, there are more advanced tools for such issues as dispute resolution. All of these tools are designed to reduce your costs and improve your customer relationship. 2. Improved Marketing Effectiveness-eDocuments can include unlimited marketing and are a much more effective means of communication than paper stuffers in envelopes. Branding, promotions, links, etc. can all be included. Full reporting capability provides your marketing team with the information they need to create targeted, highly effective, marketing campaigns. Marketing material can be changed as often as you wish. 3. Reduced Days' Sales Outstanding- Technology exists today to take payment directly from within the PDF eBill, without customers having to link to a single webpage. Email delivery results in instant delivery rather than the numerous days for the regular mail process. Clients in some cases are reporting in excess of a 30% reduction in days' sales outstanding as many customers choose to pay their bill upon receipt with a few simple clicks. 4. Increased Security-Customers and stakeholders will view their information as an offline attachment. With one easy click after entering a shared secret, documents are opened. This is more secure than either paper or online. It also gives the customer multiple options for the document including saving, filing, printing, discarding and, if applicable, paying with just one click. The Push strategy is predicated on the assumption that your customers process their information today in the inbox. For years, customers have gone to the mail box outside of their homes or the mailbox at their business office to retrieve their mail. We believe that more success will be achieved with customers by not asking them to change their habits. They are used to having their bills, statements, etc. sent, or Pushed to them. We want to continue that method but change the delivery destination to their electronic mailbox rather than their physical mailbox. Given the adoption rates being achieved with Push eDocument Delivery and the relative success compared to Pull methodologies, which are asking customers to change their behavior and go out and find their information, we believe the case for Push is clear and the Value Proposition very powerful. Electronic Bill Payment Benefits for Consumers include:
How Widely Used is Electronic Bill Payment?More and more customers are going to their keyboards instead of their mailboxes to collect and pay bills for their homes and businesses. In fact, a majority of customers who have at-home Internet access now say they actually prefer Electronic Bill Payment to the old paper-based way of doing business, according to the April 2007 Consumer Bill Payment Survey, conducted on behalf of Electronic Bill Payment vendor CheckFree by Harris Interactive and the Marketing Workshop. According to CheckFree, the most important aspect of Electronic Bill Payment is that it provides a way of enhancing the customer relationship. "It's more secure, it's more convenient, and it's faster," she says, adding that when companies implement Electronic Bill Payment, "they're creating a customer-satisfier." Electronic Bill Payment's Positive Impact on the EnvironmentA new study by Calif.-based Javelin Strategy and Research, found that if all the nation's households just received and paid bills using Electronic Bill Payment solutions, they'd save 16.5 million trees each year, or the amount of lumber needed to build 216,054 typical single-family homes. Striata have calculated that for every 500,000 bills printed, the following environmental damage is done:
Implementing Electronic Bill Payment provides a powerful Corporate Social Responsibility message to your customers and shareholders. Striata's Electronic Bill Payment SolutionTo find out more how Striata can assist in your switch to Electronic Bill Payment, read our Electronic Bill Payment.
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