$1B Opportunity In The Electronic Bill Presentment & Payment Market In 2004 - Industry Trend or Event

EDP Weekly's IT Monitor, April 3, 2000

Momentum is starting to build in the Internet-based electronic bill presentment and payment (EBPP) market. In 1999, worldwide revenues jumped 540 percent, landing at $32 million, but this is only a small stepping stone in comparison to how high this market will climb. IDC forecasts the market will escalate at a 100 percent compound annual growth rate through 2004, bringing revenues over the $1 billion mark.

Internet-based electronic bill presentment and payment is the process that enables bills to be created, delivered, and paid over the Internet.

"Buying products over the Internet with a credit card has become a common occurrence, but viewing the credit card bill itself and submitting a payment to settle it electronically is still considered a novelty," says Albert Pang, research manager for IDC's eCommerce Software program. "However, this will change as electronic bill presentment and payment products become more sophisticated with the inclusion of features such as secure email delivery and as the technology becomes increasingly implemented in business-to-business ecommerce."

According to IDC, the real opportunity in this market rests with transaction-based revenues, which will skyrocket from $700,000 in 1999 to $825 million in 2004. "Much of this growth is based on the potential use of electronic bill presentment and payment to replace the sheer number of paper bills circulated every year," Pang said. IDC estimates that in the United States alone, 1.5 billion bills are sent to consumers each moth, reaching 18 billion transactions and generating nearly $6 billion in processing fees a year. However, only a portion of these transactions will be handled by electronic bill presentment and payment systems. "Consumers initially will be resistant to this technology," Pang said. "People tend to be overly cautious when it comes to embracing new ways to handle their personal finances.

"This is a market that is still in its infancy, but it has the potential to blossom into a staggering opportunity," he added.