Advantages to be gained in terms of higher customer retention
and increased profits from the adoption of electronic billing
(e-billing) and online bill payments have been yet again confirmed
by a study undertaken by financial technology vendor Fiserv.
Conducted for Fiserv by research firm Aspen Marketing Services, the
study evaluated data from 8 million residential customers of US
telecommunications company Quest Communications over an 18-month
period, with analysis concluded in April 2009.
Based on its findings Aspen found that the analysis found the most
significant linkage between billing and business benefits were
among early tenure customers – those who had been customers for
less than 28 months.
Specifically, among early-tenure customers:
• E-bill users are 12.5 percent less likely to leave, are 35
percent more likely to pay their bills on time and purchase 20
percent more products than paper bill users;
• Automatic, recurring payment users are 14 percent less likely to
leave and 86 percent more likely to pay their bills on time;
• Users who combine e-bill with recurring payment are more loyal
and more profitable than other customer segments.
From a cost perspective, the study validated the importance of
delivering e-bills not only via an organisation’s own website, but
also via financial institution sites. This, explained Fiserv, is
because where a bill is received impacts payment method.
For example, among Quest customers studied 74 percent who receive
an e-bill at a bank site pay using an electronic deduction from
their bank account, a low-cost form of payment. Of customers that
receive bills at the company site, 40 percent pay using a credit or
debit card-funded payment, a higher cost method of payment.
Based on Aspen’s findings, over 70 percent of customers that
receive a paper bill will pay with a paper cheque. According to
data quoted by Fiserv the cost of a paper bill presentment is $0.45
per bill compared with $0.15 per e-bill presentment via a bank’s or