Streamlined billing Featured

8:00pm EDT May 26, 2008

Electronic bill payment solutions allow businesses to trim costs while improving efficiencies. By eliminating the need for customers to deliver or mail paper items, payments enter the collection stream quicker and with less effort than through traditional methods.

Electronic payment alternatives enable bill payers to make payments at their convenience 24 hours a day, seven days a week through a variety of convenient electronic options including debit cards, major credit cards and electronic check. Companies using an electronic bill payment solution can improve their record keeping while saving time and costs.

“Electronic bill payment allows a company to automate the payment collection and posting processes,” says Joy Gilmer, senior vice president of treasury management for Comerica Bank’s Western Market. “It reduces or eliminates exception items, therefore saving time in internal costs.”

Smart Business spoke with Gilmer about electronic bill payment, how the concept works and how companies can benefit from the solution.

In what ways have banking solutions advanced during the past several years?

In the past, accounts were settled with cash and checks either on-site or by mail. Banking solutions have advanced to mobile solutions — transactions can be conducted electronically, over the Web or over the telephone line. With checks now being intercepted and converted into electronic form, the process and exchange can be conducted electronically.

How does the concept of electronic bill payment work?

Electronic bill payment allows companies to offer their bill payers an electronic payment alternative without making a large investment in infrastructure and staff. Payment options include making payment via the Internet, interactive voice response or a human contact center representative.

A company should first try to understand what its customers are asking for based on customer comments, typically through its existing sales and customer service teams. It then sits down with its bank respresentative and begins to form a customized electronic bill payment solution, which can include payment delivery channels, settlement choices, payment parameters and security controls.

What benefits does an electronic bill payment solution provide to business customers?

The electronic bill payment solution is a value proposition for companies and enables them to better serve their customers by providing additional payment options, flexibility and convenience. Customers are able to make their payments when and where it is convenient for them to do so. A company is now empowered to collect payment 24-7, which accelerates the accounts receivable timeline and results in quicker deposits of funds. It also automates the updating of the accounts receivable system, reduces fraud, eliminates audit concerns related to the storage of private financial data of customers, eases account reconciliation tasks and provides new customer service tools for internal staff.

What kind of fraud protection and security measures are incorporated into an electronic bill payment solution?

There are multiple fraud protection security measures, which include the number of days a payment can be made, number of payments made in a day or specified time frame and ZIP code validations. Companies can restrict their customers and only allow them to pay via a particular settlement option, such as a credit card, particularly if the company has already experienced returns for non-sufficient funds in electronic checks. Also, card verification values can be set up, which are similar to a security code on the back of a credit card. In some cases, a company may elect not to accept an electronic payment by using a negative file, also known as a stop file. You see this feature used a lot with mortgage companies because in some cases accepting a payment could cause legal issues down the line.

How can electronic bill payment be branded with a company’s own identity?

At Comerica, with our Easy Pay option, we brand the solution with the client’s own logo, look and feel. If the company chooses the Internet-only solution, our client needs to provide us with its current Internet site address and a file containing its logo so that our site will look like the client’s. If the client cannot provide us with those items, we will work with the company to build a site.

JOY GILMER is senior vice president of treasury management for Comerica Bank’s Western Market. Reach her at (714) 435-3931 or