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Safe and Sound for 20+ Years and More than Just Bills!Nov 20 '00 Write an essay on this topic.We have been using electronic bill payment systems since the 1980s, as they evolved from telephone banking to web banking. Fewer than 1/2% of transactions have had problems and every problem has been resolved with no delay or loss. We make about 300 transactions a year, and have one, maybe two problems a year -- about the same as mailing payments and checks. However, in the case of electronic bill paying, you have a free bank advocate to make the calls, resolve the problem for you after your one call. With conventional payments, a lost check, cashed check but no payment posted or other problem means you must make all the calls yourself. Our 20 years or experience are made up of over 10 years with Mellon's telephone/web banking system. The other 10 years are made up a series of banks that were merged with other banks, and now we use a local Maryland bank, Sandy Spring National, for web bill paying. The secret to electronic bill paying is to write the payments into your check book just like a check, scheduling the payments as soon as you receive the bills. We put an "e" in circle where the check number goes to flag such entries. While we do have a few automatic repeating payments scheduled, it's much better to time your payments to your direct deposit of salary checks to avoid overdraft transfers, maximize interest and take advantage of float. When you reconcile your checking statement, just treat the electronic payments like checks. After a few months paying merchants, you get the feel for how long particular merchants take to receive/post your payment. Major banks and utilities take 1 to 2 days while paying your paperboy might take five days. Should you ever receive a bill that says you didn't pay the last month's bill, all that is needed is a toll-free call or e-mail to have the bank fix the problem. We have never had a late fee charged after the bank demonstrated the payment was made, and every missing payment over these many years and many transactions was always the merchant's fault. The biggest risk is that the merchant will incorrectly post your payment. This will most commonly happen when dealing with merchants receiving many payments rolled into one check from the bank. They miss-key an account number and then the payment is miss-applied. However, most of the big merchants get all the payments electronically and there is little room for human error. Certainly less than processing manually regular checks. The best part of electronic bill paying is that you don't always have to use it to pay bills. We frequently use it to transfer money to our children's bank accounts, our brokerage accounts and schedule payments to various savings and checking accounts. It's a money management tool, allowing you to anticipate income and schedule movements of funds. Of course, in case income doesn't arrive when it's supposed to, a no-fee overdraft line of credit is mandatory with any bill payment program. If anyone lives in in Pennsylvania or Mellon Bank's service area, Mellon's unique advantage is the ability to call in toll free from a phone to key in payments; a great advantage. Regarding fees for the service, we have been able to avoid them with direct deposit or other relationship banking arrangements for years. Even $4.95 or so a month is a bargain, getting it free is even better! We have four web checking accounts all offering web bill payments for free, so if your local bank won't meet the expectation, you can always set up your direct deposit to a web bank (NetBank.com, First Internet Bank of Indiana, or USABankshares.com are three we use) and then have your web bank "pay" your local checking account to keep it full of spending funds.  |
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