SAN FRANCISCO - The head of Citigroup Inc.'s Internet payment service on Friday described electronic bill payment and presentment as a technology that is frustrating, confusing, and devoid of easy answers.
"I've never come across anything quite so complicated," Antony Jenkins, a Citigroup chief operating officer, said in a keynote address at Thomson Financial's fourth annual Electronic Bill Payment and Presentment conference.
That said, the nation's largest banking company still sees enormous opportunities in EBPP, and it is experimenting with different ways of using the technology.
One has been to take the simplest possible approach by offering bill payment without presentment. A second has been to use the "biller-direct" method in its credit card group, letting cardholders pay their bills at a Citi Web site. A third is an effort, with partner companies, to offer customers a consolidated view of all their bills. A fourth is to help its corporate customers generate electronic bills.
"We as a company remain committed to moving the industry along, because we believe there are huge benefits to consumers and billers, as well as banks," Mr. Jenkins said.
He said that the people who sign up for Citibank Online are the bank's best customers, and "the ones who enroll for bill-pay are the best of the best."
About seven million to eight million of Citi's 100 million credit card customers nationwide are using its "Card Member Central" biller-direct site to view and pay their card accounts from any deposit account at any bank. Citi's consolidated picture of bills occurs through a framed page on the Citibank site that connects users to PayTrust's consumer front end. Its partner on the corporate side is BillServ.
"We think biller-direct is going to increase," Mr. Jenkins said. "We think bill-pay-only is going to increase. We think consolidation is going to increase - but only when we find a more cost-effective solution."
Because of the service's high cost, electronic billing by definition attracts a wealthy clientele. Citi's card-direct site is free, but its bill-consolidation service costs $4.99 to $9.99 a month, depending on the number of bills consumers pay online, Mr. Jenkins said. "We think that really limits the market, limits it to a high-end demographic."
While electronic payments are challenging, the conventional way of paying bills is no piece of cake either, Mr. Jenkins said. "A lot of consumers like to put their bills in a shoebox and pay them once a week, with checks and envelopes and stamps. It's messy for them, it's messy for the billers."
A slick online alternative - in which consumers would be notified with an e-mail when a bill comes in or an unpaid bill comes due - makes a lot of sense but poses tremendous obstacles, Mr. Jenkins said.
Ideally such a service would offer a pay-now or pay-later choice, and would let customers pay the full amount or a portion, store old bills for future reference in an online warehouse, and access bills over the Internet whether the consumer is at home or on the road.
"The time is definitely right for this type of switch," Mr. Jenkins said. "The price point around these services is a major inhibitor."
The fracturing of the industry - with multiple billing service providers to generate electronic statements, multiple consumer service providers to present those statements to retail customers, and competing switches - is creating confusion and slowing adoption by everyone involved, Mr. Jenkins said.
"There has to be more centralization and less fragmentation in the industry," he said.
Progress is evident, Mr. Jenkins said. Two years ago, businesses questioned the need to offer online billing, while today a growing number are willing at least to give it a try. But, he said, it has been "a long and winding road."
