What`s holding us back?

Gartner maintains that virtually all new technologies and applications go through a `hype cycle`. There is the initial "technology trigger" sparked by a product launch or public demonstration. This is immediately followed by a "peak of inflated expectations", which is a time of over-enthusiasm and highly exaggerated expectations. The process then moves into a "trough of disillusionment" as the public begins to wonder if there is indeed any value in the product or service at all.

Standard Bank`s recent announcement that its customers are able to receive statements and balances via e-mail has created incredible momentum in the industry.

Alison Wright, Sales and Marketing Director, The E-mail Corporation

Gartner believes that 2000/2001 was a "trough of disillusionment" for e-billing in the US. Despite the market`s initial high expectations and the successful building of applications, consumers were surprisingly slow to adopt. The slow spread of EBPP can also be linked to the market`s inability to understand just how effective e-billing can be in terms of significantly lowering costs and retaining customers.

Despite US disappointment that the uptake of e-billing has been slower than expected, the market`s outlook is far from bleak. Towards the end of 2001, many enterprises did gain respectable consumer adoption by implementing customer-focused strategies. Their success appears to be linked to the fact that they offer free, easy to use applications that greatly enhance customer service and satisfaction.

Gartner estimates 2002 will see a move to phase four of the `hype cycle` and that we are moving up the `slope of enlightenment`. They estimate that 26% of companies will use some form of e-billing by the end of 2002, compared to just 9% in early 2001. They also believe that by 2005, 97.5 million US users will adopt e-billing and online account management.

SA`s progress in implementing EBPP has been somewhat different to that of the US. As opposed to experiencing a "trough of disillusionment", we have experienced a "time of cautious investigation".

While there has been much interest, especially in the bill presentment aspect of EBPP, many companies have been treading water while observing the banks for direction. It is the classic "After you Alphonse" routine. Somebody - bank, biller or vendor - had to jump in and start sending invoices and statements electronically before anyone else seriously considered following suit.

Standard Bank`s recent announcement that its customers are able to receive statements and balances via e-mail has created incredible momentum in the industry. Many financial institutions, service providers and retail outlets are currently in the process of investigating and implementing an e-billing system.

A major factor in the move towards a paperless billing society is the significant reduction in cost. By sending a statement electronically, as opposed to through the post, billers can reduce their costs by up to 90%. This saving alone is the key justification for electronic billing.

An added benefit is the unique marketing opportunities that e-billing provides. For many companies, an invoice is the most frequent and regular form of communication with customers. And, as opposed to the general flyers we receive in the post, e-billing allows for profiled marketing messages to be included in each mail.

My bank, for example, can see that I have financed my car through it, but that I have not yet taken out a home loan. It can then include a marketing message along with my statement, informing me of the low interest rates available on home loans. Billing is thus transformed into a dynamic, personalised and strategic point of customer contact.

The introduction of e-billing also results in a reduction in telephonic-based customer service due to the self-service nature of the online environment. It reduces customer care costs by providing anytime, anywhere access to electronic account management functionality.

Additional benefits include a reduction in debtors days as a result of a significantly faster bill payment cycle; a decrease in expenses related to payment errors; and the competitive advantage companies gain from enhancing customer loyalty and satisfaction.

The bottom line is that payees, both consumers and businesses, can derive some economic benefit from e-billing, but most value it because it is highly convenient. They can pay bills electronically while taking full advantage of the possibilities of the Internet to consolidate their bills and access their accounts in a private and secure fashion.