New system for Web bill payments
CyberCash and software firm BlueGill Technologies form a solution that lets companies issue bills online and allows customers to pay those bills on the Web.
BlueGill's 1to1Server software lets companies generate personalized Internet bills from existing software that prints bills on paper.
CyberCash sells "cash register" software so billers can accept payments by credit card or CyberCash's forms of electronic cash or electronic check. CyberCash also collects a fee on each payment.
Under a system known as "bill presentment," utilities, credit card firms, and other companies can do billing online rather than through the mail, thus getting payments faster, saving postage, and potentially reducing handling costs.
Brokerage house Robertson, Stephens estimated in an August 12 research report that the market for electronic bill presentment is worth at least $1 billion--plus another $500 million in fees for handling electronic payments such as those CyberCash will collect.
"Banks and utilities have found that using a statement is the best way to communicate with their customers. It is critical to a company's business strategy," said BlueGill chief executive Hal Davis. Today, companies use "bill-stuffer" inserts in mailed statements to outline payment options or rate information, or to sell other services.
Online billing lets companies communicate those messages but also perform more complex applications, such as analyzing bills, detecting spending patterns, and calculating costs of making changes.
"We deposit the payments directly to the biller's bank," said Richard Crone, a CyberCash vice president who runs its electronic checking and billing operation. This eliminates the lag time during which payments are in the mail or being routed through a third party.
Other players in an increasingly crowded market include CheckFree MSFDC (a joint venture of Microsoft (MSFT) and payments processor First Data (TCK)), Intuit (INTU), and Integrion, a joint venture of IBM (IBM) and 18 major North American banks.