ACH for Utility Companies

ACH for Utility Companies

Utility Companies Move to Electronic Payments

Electronic payment processing is continuing to expand within utility companies as more consumers are paying bills electronically rather than writing paper checks. 

ACH payments have long been popular for utility bill payments.  ACH is a low cost method of accepting payments for utility companies.  

Credit cards and debit cards are now increasingly popular as well.  The credit card companies have special rates for utility bill payments.  For example, new rates on utility payments would generate a flat $1.50 in interchange for a $200 transaction.  This replaced the old rates where the same payment would have cost $4.74.

Acquiring banks, who pay interchange to the issuing banks, decide whether or not to pass savings on to their utility clients. Acquirers serving utilities make recommendations about what electronic transactions work best for utility companies.  But, of course, the acquirers are most interested in their own profit margins.

Recurring Billing with ACH

Utility companies are the perfect application for recurring billing.  Customers pay utility bills monthly. Electronic payments are processed faster than paper checks.

Millions of Americans already pay utility bills through ACH recurring payments. Processing fees for ACH are significantly lower for ACH payments than for cards.  

Conclusion

Whether it’s a one-time payment or recurring, consumers are very comfortable paying utility bills with ACH.  Utility companies can accept payments online, over the phone, at walk-in bill-pay centers, or via written authorization for recurring billing for ACH.

For more information, contact info@nationalach.com

Online Bill Pay Continues to Rise

A PayItGreen Survey 2010 reports that consumers pay bills online-only are more satisfied with their bank and/or credit union.  In addition, payments online, either via ACH payments, credit cards or direct from banking sites appeals to consumers “green” consciousness about helping the environment.

As might be expected, consumers ages 55 to 64 are farthest behind in paper statement adoption at 20%.  But twice as many 25- to 34- year olds have adopted paperless bill payment

According to PayItGreen, if only 20% of American households switched from paper to electronic bills, statements, and payments, nearly 2 million trees, 151 million pounds of paper, and more than 100 million gallons of gas would be saved every year.

Mobile phone (49%), student loan (49%) and Internet (44%) bills are those most commonly received electronically only.

Utility companies lag behind other industries in electronic billing adoption.  For example, electricity (33%), gas (32%), and water (24%) were some of the lowest percentages of online bill pay.

For more information, contact info@nationalach.com

ACH Payments Save Time, Money and Helps the Environment

According to the Electronic Payments Association, consumers save both time and money paying electronically rather than writing paper checks.

Consumers who pay bills online save the least 90 minutes a month off the time it takes to pay monthly bills by paper check.  An average consumer paying bills by paper check spends two hours of month to write out the checks.  Those paying electronically spent only 15 minutes a month.

Consumers who have 20 bills each month save $150 a year if they pay by electronic means rather than writing out a paper check.  The $150 includes postage, the cost of checks, late fees, and fuel.

Paying bills electronically is safer than paying with a paper check.  Identity theft most commonly starts with somebody seeing personal information on paper checks bills or account statements.

Identity theft is frequently a crime of opportunity.  In considering the number of people who see personal information when the bill was paid by paper check, there is a higher likelihood of information being stolen simply because more people are seeing the information.  When a bill is paid electronically, there are no intermediaries who can steal the information.

Another reason to pay with electronic checks is to help preserve the environment.  If all Americans started paying bills electronically rather than by paper, 151 million pounds of paper would be saved annually.  The amount of paper being saved equates to 8.6 million garbage bags of waste.  Electronic payment of bills would eliminate 2 million tons of greenhouse gas emissions from polluting the environment.

For more information contact info@nationalach.com

ACH Payments for Utility Companies

Electronic payment processing is continuing to expand within utility companies as more consumers are paying bills electronically rather than writing paper checks. ACH payments have long been popular for utility bill payments. ACH is a low cost method of accepting payments for utility companies.

Credit cards and debit cards are now increasingly popular as well. The credit card companies have special rates for utility bill payments. For example, MasterCard’s latest schedule utility payments would generate a flat $1.50 in interchange for a $200 transaction. This replaced the old rates where the same payment would have cost $4.74.

Acquirers, who pay interchange to the issuing banks, decide whether or not to pass savings on to their utility clients. Acquirers serving utilities make recommendations about what electronic transactions work best for unity companies. But, of course, the acquirers are most interested in their own profit margins.

Utility companies would prefer that consumers set up recurring payment models. Recurring payments are quite common for ACH payments. But, credit and debit cards still are generally initiated for one-time payments. Card transactions are most often paid directly on the biller’s websites or over the phone.

For more information, contact info@nationalach.com