E-mail has revolutionized the way businesses communicate with employees, vendors and customers. Now it has the potential to change the way you do your corporate billing, too.
Electronic payments have been available for some time from third parties, but oftentimes the costs associated with using it for billing customers are more than those of using paper bills and the postal service because of transaction fees.
Brinkman Technologies Inc. has come up with a solution that allows medium-sized businesses with a large customer base to essentially create their own in-house solution. If you are a biller, you simply install this software on your Web site, says Mark Brinkman, president and CEO of the Dallas-based company. The Web site is updated from the billers accounting records. When a bill is due, an e-mail notice is sent to the customer, who can view the bill on the Web, make payment arrangements or set up automatic drafts to be taken out of a bank account.
The system handles the automated clearinghouse transactions the electronic transfer of funds through the Federal Reserve for you.
Customers have to agree to use the system, so to get a high enough percentage of users to justify the investment, a business will probably have to have approximately 10,000 customers. Smaller firms can access the service through banks and other institutions if they dont have the economies of scale.
Anybody that has recurring bills would be a candidate to use this technology, says Brinkman. The utility companies have been the first to pilot and run this system.
The base cost for a small business to set up the system in house is $35,000 for the software, not including the Web server and associated communication fees. There is a 20 percent maintenance fee based on the original cost, so a small business would pay $7,000 annually.
A business with 30,000 customers, sending out monthly bills, could expect to pay about 11 cents per bill for presentment and payment, a significant savings over postage and paper methods. A smaller business working through a bank or other provider could expect to pay between 15 to 25 cents per bill.
Were basically billing people the same way, were just handling all the paper electronically, says Brinkman. Were cutting out the United States Postal Service. You still receive a bill in the mail, its just in your e-mail, and youre still sending payment in, its just electronically transmitted through a bank.
Other links can be placed on the e-mail or Web site, allowing customers easy access to customer support, special offers or new products.
The business is in control of the site [where the bills are presented], so they can do any marketing they wish, notes Brinkman.
For a demo of electronic bill presentment and payment, go to www.nextbill.com.
Todd Shryock (email@example.com) is SBNs special reports editor.