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Companies banking on online bill payment

Yahoo, AOL, Bank of America, Citibank and others are betting on the expanding popularity of being able to receive and pay bills over the Internet.

Bills are stacking up on the Internet.

That's good news for companies such as Yahoo, AOL, Bank of America and Citibank, which are betting on the expanding popularity of being able to receive and pay bills over the Internet.

IDC, a division of International Data Group, predicts that the electronic bill segment will grow to $1 billion by 2004. The segment took in $32 million in revenues last year, a 540 percent jump from 1998, the study found. Market revenues should double every year for the next five years, the study said.

However, online bill payment "is still in its infancy," said IDC research manager Albert Pang in a written statement.

So far, consumers and billing companies have been slow to embrace electronic bill payment. IDC points out that of the 1.5 billion bills U.S. consumers receive each month, only a fraction currently are presented or paid via the Internet.

Companies want to see more consumers request an e-billing option while consumers are waiting to see more companies issue bills online.

One reason consumers continue to sign paper checks is out of fear of sending sensitive financial information over the Net.

"This will change as electronic bill presentment and payment products become more sophisticated with the inclusion of features such as secure email delivery," Pang said.