Articles
Driving 'Electronic Bill Presentment & Payment (EBPP)' Adoption in the USA - ( Aug 2004 )
According to eBilling specialist, Striata, "Billers & banks alike have been struggling for many years to
drive reticent customers online to utilize their Electronic Bill Payment & Presentment (EBPP) services. Over
70% of Americans are using email regularly, yet less than 20% of US adults have tried viewing & paying bills
online. In fact, in almost all industries & market verticals, adoption to online EBPP varies from less than
2% to only 15% of customers.
"The challenge remains: how to attain a significant number of customers using electronic means to receive
and pay their bills. The answer is a simple one: stop expecting customers to come to you and start delivering
their bill to them." says Garin Toren, COO of Striata, North America.
Is it really that simple? The answer is a resounding 'yes', and here is why:
Let's begin by looking at the state of the market
As of 2003, Forrester tells us that 17% of US homes have / are paying their bills online. Forrester further
predicts (in a January 2004 report) that the growth rate of US homes paying their bills online will reduce
from 20% in 2004 to 7% in 2008 and that by the end of 2004, only 21m US households will be paying their bills
online.
The bottom line is that billers are going to need to do something different going forward, if they hope to
achieve serious customer adoption.
Why did the current online EBPP solutions not achieve the expected results?
The key here is to understand what it takes to get a customer to use an internet website based EBPP solution.
The biggest difficulty is getting sufficient customer inertia for them to go to the biller's website and sign
up for the service. If you ask customers to do anything, you can rest assured that 90% of them won't do it.
Further to this, there are many more challenges to overcome:
- An online EBPP solution presumes that a customer has reasonable internet speed & is relatively web savvy. Unfortunately, according to Nielson/NetRatings, just on 60% of Americans are still dialing up to the Internet.
- The online solution requires a customer to register, choose a user name & password and then remember it.
- The online bill very seldom looks anything like the paper one that the customer is familiar with.
- Many customers are very wary of Identity theft and Phishing. This is creating further barriers to adoption.
- It is just plain inconvenient to go online, login, find your bill and pay it.
- If every biller that a customer deals with has his own EBPP site, the customer has to register with each one, remember multiple usernames & passwords, and visit each one separately to view & pay their bills.
- There is limited, if any, aggregation of online bills.
For EBPP to be a success, the customer has to be offered a totally convenient and effortless aggregation of all
his bills in a single place. (After all, this used to be his postbox at the end of his driveway.)
The answer is secure email delivery of bills and statements
In Europe, Africa & Australasia, billers & banks have the ability to securely delivery a bill, statement or
any other document, to their customers, via secure email. This has many advantages, the first and foremost of
them being the fact that the bill is delivered to the customer, who does not have to do anything to receive it.
So why is adoption of email EBPP so much higher than online EBPP?
- Email has significantly higher usage than browsing the Internet. Over 70% of Americans use email regularly.
- There is no inertia required by the customer.
- There is no website to visit.
- There is no registration form to complete.
- It looks exactly like the paper bill. (This familiarity with the biller's look-and-feel drives customer acceptance and adoption.)
- There is no user name & password to remember.
- There is no fast internet access required.
- There is no need to be connected to the Internet to view the bill.
- All bills arrive into the inbox (just like the postbox at the bottom of your driveway). The customer is the only possible aggregator of their bills.
- As they already have the bill electronically, there is no need to download it.
- There are quick 'from within the email' payment options.
From a Billers perspective
- Email EBPP is significantly more cost effective than online EBPP.
- There is no upfront software sale and therefore no ROI to prove, the biller only pays for the bills that he sends electronically.
- Deployment is rapid and highly configurable.
- The billing process can be fully automated.
- High adoption rates lead to massive time, paper & postage savings.
- Billing cycles are drastically reduced.
- Bill delivery is instant.
- There are many International proven case studies to learn from.
- In a January of 2004 report, Gartner shows that the majority of people surveyed would prefer to get their bill via email as opposed to either biller direct or bank aggregator models.
How does it work?
The process is efficient and simple:
- The biller collects his customer's email addresses. (This happens offline through all real-world touch points with the customer.)
- The biller then sends the next bill to that customer in a secure email with clear instructions on how to open it.
- The customer decrypts the bill using an existing 'shared secret'. (A Credit Card pin number, for example, in the case of a credit card statement).
- The customer then has the bill open on their local machine. (They do not need to be connected to the Internet to view it.)
- They can save it to their local machine (it remains encrypted) or they can print it.
- It looks exactly the same as their paper one.
- Should they wish to, they can pay it from within the email. (Without navigating to any website.) They could also choose to pay it via paper check or through any other payment option that the biller offers. It's all about customer choice.
- After a period (two to three months) the biller turns off the paper bill, but gives the customer the option to turn it back on. (Less than 5% of customers do.)
- A biller can also link the email bill to his website for additional customer self service.
- The email bill has multiple marketing opportunities (which are 100% personalizable) to replace the traditional 'bill stuffer'.
Complimenting email EBPP with an online solution:
Online and email EBPP need to work hand in hand as complimentary solutions to offer customers the best of
all worlds. By combining the two offerings, billers can take maximum advantage of the available technologies
to offer customers a wide choice on how they would prefer to interact with the biller.
The two offerings provide both overlapping and unique benefits, sometimes to different customer segments.
The most comprehensive Internet bill offering is the process that makes use of a combination of the two
methods.
Historically, the emphasis has been on bill presentment websites. With the changing profile of online users,
it is apparent that even those organizations with large bill presentment infrastructures, need to complement
this process with a secure email offering.
Striata
Striata is an application software developer and service provider focused on enabling secure electronic
communication. The Striata Application Platform provides highly flexible, robust and scalable products
deployable across multiple operating systems. Striata's solutions are applicable to organizations that view
efficient communication with customers and stakeholders as a vital component of their success.
Striata specializes in the secure delivery & payment of Bills, Statements & Invoices via encrypted email.
Striata has been a provider of software and services in the electronic messaging arena since 1999 and have
offices in New York, London, Sydney and Johannesburg and partners in Dublin, Frankfurt, Atlanta, Washington DC,
Honolulu, Sydney and Cape Town. Visit www.striata.com
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