UK clearing house Bacs has embarked on a joint venture with
a US software company to provide an online bill presentation and
payment service for banks.Bacs and CheckFree, a specialist in electronic billing whose
products are used by more than 1,100 financial services companies,
will allow consumers to view and pay bills from their bank’s
website. Bacs, which processes direct debits and direct credit
salary payments, aims to sign-up a high street bank and utility
company for the service by the end of the year.
The service is the first example of Bacs diversifying away from
its core payment clearing business, a move predicted by Computer
Weekly last month.
Although some banks and utility companies offer online bill
viewing and payment services, Bacs and CheckFree believe there is a
gap in the market for an industry-wide service. Benefits for banks
include reduced costs by cutting out paper billing and encouraging
customers to visit the banks website more frequently.
Bacs will use its clearing network to provide the service while
CheckFree will use its financial messaging, workflow and compliance
software to support the service.
Martin Kearsley, managing director of the company set up to
deliver the service, said, “There are significant business
advantages for billers and banks to adopt the service, and I
believe it will change the way consumers will manage their
money.”
Anthony Miller, research director at analyst firm Ovum Holway,
said Bacs’ joint venture complemented its core business but
questioned whether there was enough demand for online bill
presentation and payment services in the UK.
Meanwhile, Bacs is migrating more than 50,000 corporate
customers onto a new IP-based network. Users have until the end of
2005 to upgrade their Bacs connection software before the old
private network is switched off.
Users will benefit from faster payment confirmation and the
ability to track the progress of payments online, rather than
having to wait for receipts for confirmation.