Energy Biz - March/April 2008 - (Page 52) » GUIdEBOOk (BIllING aNd CUSTOmEr CarE) be either one-time or recurring payments. What’s relatively new is the electronic bill, with monthly usage sent via e-mail or through the website in a paperless operation. Customers can still opt for a paper bill, even if paying electronically, under this method. E-mail biller Striata said there are four main reasons why companies offer electronic bill presentment and payment. They are cost take-out, instant delivery, quicker recipient response and improved marketing capability. Added to these motives in more recent months or years is the desire to be “green.” Consumers are demanding environmental awareness on the part of vendors across all areas of business, which has extended to utilities’ desires to be responsive by offering paperless solutions to the consumer waste stream. Changing demographics is also another factor driving utilities to more readily accept electronic payments. Younger and more tech-savvy customers increasingly see the convenience of electronic payments, so much so that paper checks are losing market share quite dramatically. The automated clearinghouse payment method – deductions from a checking account – has been popular over the past 25 years or so. According to recent research done for Fort Knox National Co., all utilities still receive payment by paper check from half their customers, the highest among those companies that receive recurring payments. “Bill payment electronically for utilities has overlapped generally with payments like insurance companies and other providers. There has been more of an effort in the last 10 years or so, especially with utilities. Providing the service has been a market challenge,” said Steve Carnevale, MasterCard Worldwide’s vice president of U.S. commercial development. One impediment for online credit card billing has been the convenience fee assessed to customers, usually around $4 for a transaction. There’s also the challenge of whether the utility is working in a regulated or deregulated environment and whether a convenience fee is allowed. For obvious reasons, companies are reluctant to absorb that cost. Utilities were not always willing to sign up to pay a commission the way a store or the travel industry might. So MasterCard began a special utilities program in credit policy and payment administration. AEP is more heavily promoting the option on its websites. It also has seen some success by touting the practice on the back of its payment return envelopes, driving customer interest. The payment option is through a third-party vendor that essentially works like a debit card with the customers’ checking account. This automated clearinghouse is AEP’s only payment option. AEP currently does not offer its customers a credit card payment option, though Crawford said the company continually reviews its practices. There are two components to the electronic commerce options. For several years utilities have offered payment methods through their websites, either via a credit card or through a debit through a checking account. These can The Complete Solution For Utilities Copyright © 2008, Oracle. All rights reserved. Oracle is a registered trademark of Oracle Corporation and/or its affiliates. 52 308M00433_UTL_MoreComplete.indd 1 E n E rgyB i z March/April 2008 2/12/08 4:01:59 PM http://www.oracle.com/industries/utilities
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