EBPP in Western Europe and the US 2004

Early forecasts on adoption and growth of electronic bill presentment and payment solutions were optimistic. But despite the potential benefits of this new technology, the predicted growth in Europe has yet to appear, and even in the US providers have struggled to demonstrate healthy business. This briefing examines the reasons behind this and looks at the market's future prospects.

REPORT HIGHLIGHTS

Out of the two main models, the biller-direct approach to EBPP has had much more success with consumers. However, industry experts agree that the future lies with the thin version of the consolidation model, as it allows billers to maintain close customer contact, while offering consumers the convenience of consolidated bill viewing.

Despite the competitive advantages EBPP can bring, growth of the market has been below expectations. Though the US is the global market leader, Datamonitor estimates that EBPP accounted for less than 10 per cent of all US bills. In the UK EBPP solutions have yet to catch on, with less than 1 per cent of all bills delivered and paid online.

One of the reasons for the indifferent EBPP growth in Europe are existing payment infrastructures. Direct debit, for example, demands minimum effort from consumers and is cheaper than online payment processing. However, online billing offers long-term advantages of targeted marketing and cross-selling which cannot be ignored.
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ABOUT DATAMONITOR

CHAPTER 1 INTRODUCTION

What is this briefing about?
Scope and definitions
Who is the target reader?
How to use this briefing

CHAPTER 2 EBPP EXPLAINED

There are two main models of electronic bill presentment and payment
The biller-direct approach establishes EBPP capabilities on a billler’s own website
The consolidator approach relies on a central aggregator
So far, the biller-direct method has proved more popular, though the future momentum lies with the thin version of consolidation model
Various types of players are currently contesting the market
Traditional billers can benefit from the cost-saving aspect of EBPP
Third party providers have established a strong position in the market
FS companies have multiple roles in the EBPP process

CHAPTER 3 EBPP – STRUGGLING TO SUCCEED

EBPP implementation can provide companies with a number of competitive advantages
Cost-saving is one of the most compelling arguments for EBPP
EBPP offers competitive advantages through delivery of superior customer service
EBPP offers valuable opportunities for targeted marketing
EBPP offers enhanced cross and up-selling opportunities
EBPP helps in attracting more affluent customers
Despite the potential advantages of EBPP implementation, the current market is struggling in terms of its size
The US market is far more developed in terms of EBPP use and adoption
While in the UK EBPP accounts for a fraction of all consumer bills
If EBPP were implemented fully, the potential cost savings would be substantial
Though the potential savings can be huge, only the most advanced EBPP models can offer them

CHAPTER 4 YET, TURNAROUND IS EXPECTED

Introduction
A number of obstacles has prevented the EBPP market from growing more rapidly
Consumer attitudes towards EBPP have been lukewarm
A number of prominent players have been driving the US EBPP market forward
CheckFree – the global leader in the provision of EBPP solutions
Bank of America – the largest online customer base in the world
A number of other companies are also contesting the EBPP market in the US
European companies have been slower in establishing a business case for EBPP
Alliance & Leicester – giving UK consumers a taste of consolidation
The UK Post Office – a less successful attempt at consolidation
Companies in different European countries are in various stages of EBPP development

CHAPTER 5 CONCLUSION

Online bill presentment will drive the future growth of EBPP, but a lot will depend on consumer take-up
The future EBPP growth will come through online bill presentment
But the growth can only be achieved with the help of consumers
Datamonitor Cards Team View

CHAPTER 6 APPENDIX

Definitions
Research methodology
Further information
Relevant links
Relevant reports
Datamonitor Financial Services Consulting
Datamonitor Retail Banking team
How to contact experts in your industry
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