The UK's high street banks are in discussion with telecoms suppliers and utility companies to develop a common system that could handle hundreds of millions of bill presentations and payments over the Internet.
Customers will be able to view and pay all their bills for electricity, gas, phones and water, when they choose, through a single visit to their bank's Web site. The planned service is due to be launched in the second quarter of 2003
Customers could also receive e-mail or text-based reminders when a bill is due. The project, one of the most ambitious collective e-commerce initiatives in financial services, marks a second attempt by the banks to develop an industry-wide system to pay bills online
Plans for an online bill presentation and payment system under the umbrella of payment association Apacs were ditched last year when banks failed to back the initiative.
The new billing service will be run by Intelligent Processing Solutions, a payment processing provider owned by IT services supplier Unisys and banks HSBC, Lloyds TSB and Barclays holding a minority stake.
It already processes about 70% of all cheques in the UK. It will operate as a clearing house, storing billing records on a database. Customers will view their bills by clicking on an icon on their bank's Web site, which will link to the processing site
Intelligent Processing Solutions said that more than 20% of the bills presented in the UK each year through the post could be handled by its service once it is established. It is in discussions with banks, telecoms suppliers and utilities, but stressed that plans were at an early stage and no contracts had been signed.
The facility will allow banks to offer customers an extra service while utilities could see their billing costs fall significantly by moving paper-based reminders and administration online.
"This is far too difficult a [service] for the banks to offer on a standalone basis," said Phil Hickman, chief executive of Intelligent Processing Solutions. "We are trying to change the sterile face of the banking industry."
Although companies such as Clear offer free online bill payment customers are expected to find it more convenient to view and pay all their bills through their own bank's online service, rather than logging on to separate Web sites and remembering several passwords
As many banks and utility companies already have links between their systems and bill presentation facilities the IT integration involved will be minimal. Bob Murphy, head of product management at HSBC, said that although the bank supported the proposals, issues such as security standards and who will pay for it still had to be resolved.
Analysts said that it stands a good chance of becoming the standard way to view and pay bills online but added that there was limited public demand. "There remains a question-mark about consumer adoption of online bills," said Duncan Brown, consulting director at analyst firm Ovum.