Electronic presentment and payment

Work Process Improvement Today, Jun 1998 by McNair, Stephen

Visa ePay eliminates exception items by replacing paper "check and lists" with electronic payments. Prospects for ePay are corporate billers, lockbox operations and third party processors. Funds flow directly from the consumer to the financial institution and biller.

BOTTOMLINE TECHNOLOGIES

Bottomline Technologies Inc. is using its automated clearinghouse software to let billers interact directly with consumers. The approach contrasts with that of electronic billing consolidators, which act as centralized clearinghouses for bills and payments.

Bottomline offers the option of receiving electronic payments via automated clearinghouse direct debits. Bottomline will let billers send invoices and receive payments electronically and non-electronically. Consumers without a method of receiving or generating an electronic transaction will get a paper bill printed by PayBase. Consumers with Internet access will be given the opportunity to control the amounts and dates of their remittances, the system can send e-mail messages giving consumers a Web address where they can initiate payments.

NPC

Best known for its third party processing offerings NPC has two electronic product offerings.

VirtualPAY (www.virtualpay.com) allows consumers to pay bills or make any electronic transaction over the Internet. Payments are made from the consumer's checking account or credit card. NPC markets VirtualPay to any corporation. The service is available at no charge to the consumer and does not require the consumer to use any special software. Any corporate biller with VirtualPay can allow any consumer with Internet access to make a financial transaction.

VirtualBILL allows a corporation to send electronic bills to their clients. VirtualBILL allows electronic bill presentment. Combined with VirtualPay the two products offer a complete end-to-end presentment/payment cycle.

SUMMARY

Electronic bill presentment and payment are quickly evolving technologies. The number and variety of offerings makes the market confusing. Like many new technologies this market does not have any fixed standards. The entrance of very large organizations like Integrion and MSFDC are thought to aid in the standardization effort. Electronic payments accounted for an estimated 300 million transactions of the estimated 30 billion remittance transactions. This 1% has attracted the attention of a large number of corporations.

While everyone agrees that electronic transactions will grow in acceptance and volume, the disagreement is over the speed with which the process will happen. Factors that will affect this acceptance will be accessibility, ease of use, cost-both to the consumer and biller, and standardization of use. Credit cards are widely accepted due to the standardized method of use. The same level of standardization will need to be available for electronic payments to flourish.

Stephen McNair

President

FTP Consulting Services, Inc.

Stephen McNair is owner and president of FTP Consulting Services, Inc. Since graduating from Texas A&M University in 1973, Mr. McNair has been involved in financial transaction processing as a vendor, user and consultant. He has been involved in OCR technology and document processing since 1978 and Image/Optical based technologies since 1981. Previous employers include Electronic Data Systems, Service Card System, Fort Worth National Bank, Citibank (South Dakota) N.A., and BancTec.