On the Internet, electronic bill presentment and payment (EBPP) is a process that enables bills to be created, delivered, and paid over the Internet. The service has applications for many industries, from financial service providers to telecommunications companies and utilities.
Although buying products over the Internet with a credit card has become a common occurrence, viewing the credit card bill itself - and making payments to settle the bill electronically - has not. This is expected to dramatically change as new EBPP products are introduced that include features such as secure e-mail delivery, and also as EBPP technology becomes more common in business-to-business e-commerce.
One of the obstacles to widespread adoption of EBPP lies in the complexity of billing systems and processes used by competing banks and financial institutions. Some have resisted implementing EBPP for fear of being unable to cross-promote other services to customers, although experts claim EBPP appears ideal for this type of marketing. The banking industry also has been resistant for fear of losing out on lucrative cash-management services, reminiscent of the battle the industry fought and lost over credit card transactions. Disputes over adopting uniform security and implementation standards also have stalled the adoption of EBPP.
The common protocol known as the Open Financial Exchange would allow firms to integrate their systems. But the protocol has not been widely embraced, especially by banks, which are concerned about possibly losing control of their vital customer information. A second competing standard also is emerging. Spectrum, a joint venture of The Chase Manhattan Corp., First Union Corp. and Wells Fargo & Co., is adopting the Interactive Financial Exchange (IFX) protocol. The IFX Forum, an organization that comprises financial institutions, billers, insurance companies and vendors, is developing IFX.
Despite these difficulties, experts predict the industry will experience a growth spurt, driven by customers who want the convenience and time savings associated with being able to access, view and remit their bills directly online.