Banking-technology vendor Billeo Inc. on May 11 introduced an online bill-payment tool designed to enable consumers to make immediate bill payments using credit or debit cards through their bank’s website.
The service, called PayDirect Assistant, takes the checking account out of the bank bill-payment process and enables financial institutions to earn revenue from card interchange, Murali Subbarao, Billeo founder and CEO, tells PaymentsSource. “This product is a result of conversations we’ve had with different [financial institutions] about how best to drive up card bill pay through banks,” he adds.
Banks may integrate their in-house bill-payment system with Billeo and PayDirect. Financial institutions using a third-party bill-pay service may ask their service provider to integrate the service with Billeo.
Consumers accessing PayDirect through their bank’s website select a biller from the bank’s billing directory, and PayDirect brings them to the biller’s website to log in. PayDirect will save the log-in information for future visits.
PayDirect automatically fills in the card details on the biller’s payment page. After the consumer makes the payment, PayDirect saves a receipt on the bank’s website that enables the customer to keep track of payment history. There are no fees to use the service, though some billers may charge when customer pay using a card.
“The online card bill-pay space is projected [this year] to be $1.4 trillion in volume, making the service very attractive to banks,” Subbarao says.
Subbarao believes PayDirect will entice consumers to use their bank’s bill-pay service more because everything is in a centralized location. Consumers still have the option to pay bills through their checking account for those that are not immediately due, he adds.
Billeo is in negotiations with banks to offer the service.
Offering the use of cards for bill payment enables a bank to compete more evenly with biller-direct sites, says Patricia Hewitt, director of the debit advisory service at Mercator Advisory Group. She believes banks would use the service more as a way to position the financial institution as a consumer’s most trusted and relevant online financial services provider instead of as an “incremental revenue gain.”
Separately, Santa Clara, Calif.-based Billeo has added two reward schemes to its Offer Assistant service. Discover Financial Services’ ShopDiscover rewards and PayPal Inc. shopping deals will appear online when consumers search for products and services using search engines powered by Google Inc., Yahoo! Inc. and Microsoft Corp.’s Bing.
Offer Assistant is a Web browser toolbar consumers may download for free that works with the Internet Explorer and Firefox Web browsers.
Billeo’s service also highlights rewards from American Express Co., AARP, Bank of America Corp., Bing, JPMorgan Chase & Co. and Upside, a Visa-branded prepaid card issued by MetaBank.
To take advantage of a specific offer, consumers click on it, and Offer Assistant guides them through the purchase process. The service reminds shoppers to use the right proper to receive the discount.