E-Billing Problems for Banks
Many software solutions that enable electronic billing require third party bill companies to handle various aspects of the EBPP transaction, such as data action, bill design, presentment, notification or payment processing. The companies that both present bills electronically and process bill payments tend to favor a "bill consolidation" model of EBPP. Under this model, billers submit their customers' billing data for bill presentment on a number of "consolidation" Web sites. Many of these bill consolidators are partnering with non-financial Web portals or other Internet services, such as Yahoo! and America Online.

If banks lose their role in the payment end of e-billing, they will end up losing a huge revenue opportunity, as well as vital customer relationships. If non-financial companies are successful in luring consumers to their Web sites to pay bills, they will easily be able to offer products traditionally provided by banks (investments, home mortgages, etc.). Banks also stand to lose revenue from such cash management services as lockbox, controlled disbursement and account reconciliation. Further, by deferring the role of payment processor to non-financial companies, banks lose an opportunity to serve a valuable role for their commercial customers as an electronic billing service bureau.

NextBill.com Solutions for Banks
NextBill.com provides banks with more than an EBPP system. It also provides the opportunity for banks to retain control of the payment processing and cash management functions. With NextBill, banks simply use existing ACH technology to process payments.

Not only do banks now have the ability to offer their own retail customers the convenience of paying bills online, but NextBill.com also provides the opportunity for banks to act as an e-billing service bureau for commercial customers. This service can substantially increase a bank's revenues and customer relationship opportunities, effectively allowing them to compete for their share of the lucrative e-billing marketplace.

Rather than expensive start-up costs and ongoing processing fees, NextBill.com simply assesses a one-time license fee and low maintenance fees based on the volume of transactions. NextBill.com's low-cost structure enables banks to enjoy true cost savings over paper-based billing, savings that can be passed along to consumers in the form of free or low-cost EBPP services.

E-Billing Problems for Billers
Many billers have far too few opportunities to communicate with their customers on an ongoing basis, and the monthly billing statement provides them with an excellent opportunity. Every time customers open their monthly billing envelopes, they pull out more than a statement with their amount due. Advertisements, special promotions, newsletters, etc. are popular tools for marketing and communicating to customers.

Companies make major investments in establishing a Web presence, with the goal of attracting customers, building relationships, and opening new streams of revenue. Electronic billing should enhance, not diminish, a biller's ability to communicate and build relationships with customers. Unfortunately, if a biller presents bills on an aggregator's Web site, customers go to another company's site rather than the billers. While some aggregator sites provide a link to the biller's site, it creates an unnecessary step for the customer to take.

Further, losing "control" of the bill means losing control of the customer's confidential billing data. When multiple billers provide consumers' billing information to a central company, not only are privacy issues at stake, but the opportunity for these third-party companies to aggregate a consumer's buying habits and use that information for marketing purposes is another fear that could slow consumer adoption of e-billing.

A common topic of discussion is the "chicken and egg" situation that has slowed the adoption of electronic billing solutions by billers. For various reasons, including the lack of participating billers, consumers have been hesitant to sign up for "consolidator" e-billing programs. With so few of their customers demanding electronic billing services, billers have not been in a rush to present their bills on the Internet.

Other e-billing solution providers have had the common sense to offer a system that enables billers to send bills directly to customers. However, these systems require billers to maintain proprietary "bill viewing" software on their customers' desktop PCs. This type of system requires billers to convince customers to install the software, and billers must maintain the software and provide updates to all of their customers.

Finally, the costs of offering electronic billing solutions have been prohibitive. Start-up costs for billers, including OFX technology and up-front participation fees, often exceed $250,000. Billers are also charged ongoing transaction fees by the third party bill processors for each bill presented. These fees can range from $.32 to $.50 per bill.

NextBill.com Solutions for Billers
E-mail and corporate Web sites have created tremendous opportunities for companies to communicate and build relationships with customers. Unlike many of the other e-billing systems, NextBill does not circumvent those relationship-building opportunities.

Rather than going to a "bill consolidator" site to pay bills, customers receive their bills directly from their billing company and go to that company's Web site to arrange for payment. Billers are able to include the same forms of customer communications they have traditionally enclosed along with paper billing statements. And, with customers making monthly trips to the biller's Web site, these messages and customer-relationship opportunities can be reinforced.

NextBill.com offers a very secure means of payment processing, and by eliminating the need for transferring customers' billing data to a third party processor, privacy is even less a factor than traditional paper-based billing systems.

Since bills are sent directly to customers, rather than consolidated along with other companies' bills at an aggregator's Web site or other bill presentment site, a company can simply sign up their own customers for the program. By eliminating the third parties from the EBPP process, billers can break the "chicken and egg" cycle that has prevented the rapid deployment of e-billing convenience.

NextBill.com polls the biller's accounts receivable or billing system and creates statements in HTML or MS Word format. As long as the billers' customers have a standard browser system, no special "bill viewing" software needs to be installed or maintained on the customers' desktop PCs.

Billers have a lot to gain by offering the convenience of NextBill.com electronic billing. Beyond the customer relationship building and privacy issues, billers can enjoy true cost savings that should inherently be a part of automating a paper-based system. Whether the biller decides to install NextBill at their own data center or participate with their financial institution, reduced start-up costs and ongoing fees mean that billers can expect a true and measurable return on investment.     top