No stamps necessary: Internet banking is catching on quickly
TMCnet.com

January 27, 2006

CHAMPAIGN -- Online bill paying isn't quite mainstream yet, but it's quickly getting there.

Some estimates are that as many as 40 million American households pay bills via the Internet.

Two local banks say the percentage of their customers who use online banking and pay their bills using computers continues to grow.

Busey Bank, based in Urbana, has about 20,000 customers, or 28 percent of its total customers, who use online banking. Of those, 2,700 also pay their bills online through the bank, according to Kelly Dennemann, vice president and e-business manager.

"People tend to be a little more cautious about bill payment," Dennemann said. "But it's so much faster and easier to do than sitting and writing checks."

Susan Tankersley, assistant vice president of retail at Main Street Bank & Trust, 100 W. University Ave., C, declined to give specific numbers but said 30 percent of the bank's customers with checking accounts pay bills online.

Of the online customers, 40 percent pay their bills online through the bank, she said.

"It does save time and money and is a convenience," Tankersley said.

The savings include postage and the cost of envelopes and checks. If a person pays 10 bills a month, that's $3.90 in postage saved.

Neither local bank charges for online bill paying.

But perhaps the bigger savings is in time. Dennemann said it used to take her about an hour a month to pay her bills. With online banking, that time has been reduced to about five minutes.

"It's very fast," she said.

Dennemann also said she believes that paying bills online and using online banking is actually safer than paying bills with checks and mailing them, given the problem of identity theft. She also said bills are paid quickly electronically, usually by the next day.

Other advantages: You can schedule what day you want the bill to be paid; you can arrange so that you'll receive an e-mail reminder when a bill is coming due; you can arrange to have e-bills delivered right to your computer instead of via traditional mail.

In Busey's case, electronic bill paying is done through CheckFree of Atlanta, the country's leading such firm.

Once a customer is signed up for electronic banking, he can sign up to pay bills online via Busey's site, www.busey.com. A customer has to fill out some personal details online first.

In Busey's case, a variety of options make bill-paying more convenient, such as reminders and listings of pending payments and recent payments.

Initially, Busey limits online bill payments to $400 or less, but that's for a few days until CheckFree can confirm the account exists, Dennemann said. After that, it's unlimited bill payments.

Main Street Bank & Trust uses similar procedures.

Online customers use Main Street's Web site, www.mainstreettrust.com, and click on bill paying.

The site walks a person through the process, with the first step being entering the vendors who are going to receive payment. That can be obtained through paper bills or through a data base of vendors Main Street provides.

The second step is entering the dollar amount and the day the bill is to be paid, Tankersley said.

Main Street Bank & Trust also uses a third party for bill paying, Metavante, and limits the amount a single bill can total to $9,999.

Both Busey and Main Street Bank & Trust have call centers for online bill payment (Main Street, 351-2730; Busey, 800-268-5652) in case a customer becomes stuck.