A revolution is stirring in the electronic bill presentment and payment (EBPP) industry with a concerted shift towards a model that "pushes" the bill to the customer. Requirements for greater user adoption are driving the move from "pull" to "push" in the form of an encrypted e-mail. The e-mail bill has functionality for easy payment but also includes an element of "pull" methodology in the form of a link back to a Web site allowing customers to analyse the invoice and view historical accounts.
"There is a huge groundswell of acceptance and rising demand for EBPP technology, purely because e-billing is such an obviously beneficial concept," says Michael Wright, CEO of the Johannesburg headquartered international electronic messaging specialist Striata.
"Our international experience through our offices and operations in the US, Australia and the UK and with partners elsewhere is that the pull methodology has reached its ceiling, primarily because it is human nature to not want to do something that one did not have to do before. Now we are seeing rising acceptance of push methodology which sends an e-mail invoice directly to the debtor. By combining this with optional pull functionality in a hybrid model, market needs are being met."
The push method includes functionality that allows the debtor to process the invoice in his own e-mail environment as opposed to pull methodology which requires him to go to the creditor`s Web site in order to pay. The push method does not require the debtor to do anything more than a normal paper invoice would, but is faster and easier.
"However, the 80/20 principle dictates that some debtors will want to analyse their bill and in the hybrid model they can also make use of pull functionality that offers a link to the Web site and functionality that enables them to analyse their bills and accounts quickly and efficiently. Other debtors will also make use of this technology if they receive a bill that is much higher than usual or is out of the ordinary in some other way," says Wright.
He adds that the South African e-billing market has seen strong, steady growth over the past five years. "This growth has been spurred by large billing organisations including telecommunications operators, water and power utilities, major retailers and financial service providers who are increasingly adopting the technology. Our experience in providing e-billing services in international markets indicates that this growth is likely to accelerate significantly over the next five years."
Wright says the model, not the concept, is being changed. "EBPP has legs and the only thing that is changing is the way in which the bills are being presented. Striata technology meets the requirements perfectly and this has been a major factor in the company doubling the size of its operations over the past year."
The push method involves an encrypted e-mail that delivers the invoice to the debtor with built-in functionality within the e-mail that offers the opportunity to pay the debt electronically directly to the creditor. It is a very simple process that takes just one or two mouse clicks instead of the much more complicated sequence of events at the debtor`s Web site required by the pull method, usually as many as nine clicks.
Wright says the payments can be made with a credit or debit card or can go through an automated clearing house from a deposit account, a process taking on average just 30 seconds. "It actually couldn`t be easier or more convenient and that`s the advantage over the pure pull method which drags the debtor to a Web site where he has to register, select a user name and password, revert back to the reminder e-mail, obtain the bill details and then go back to the Web site to pay. In a nutshell, the pure pull method is just too much hassle."
Striata`s international experience shows that consumers are more ready to adopt push e-mail payments because just about everybody who has access to a computer regularly uses e-mail. "Our research has shown that almost 20% of customers pay their e-mailed bills on the same day they receive them. For the billing company, significant savings also accrue from not having to issue paper invoices," says Wright.
In North America, Striata has recently been contracted to implement EBPP solutions by two major utilities, Whitby Hydro and CPS Energy, payment services company, Western Union Financial Services, and by Mexico`s largest money voucher service company, Efectivale.
Mexico recently introduced specific legislation and guidelines governing EBPP. According to Wright, this is "typical of the challenges we have had to meet in our expanding markets with ongoing development of technology that exceeds these requirements and extends Striata`s capability to provide international solutions".
The benefits of EBPP solutions for these companies include secure encrypted and immediate delivery of bills, significant savings on paper and postage costs, quicker payment that reduces the days a debt is outstanding, improved customer service and reduced demands on call centres.
Striata is an application software developer and service provider focused on enabling secure electronic communication. Striata specialises in the secure delivery and payment of bills, statements, pay-stubs, invoices and all other confidential documents, via encrypted e-mail. Striata has been a provider of software and services in the electronic messaging arena since 1999 and has offices in New York, London, Sydney and Johannesburg, as well as partners in Ireland, Germany, The Netherlands, Central and South America, and Asia Pacific. Visit www.striata.com.
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