Fold and Mutilate?

There was a "personalized" letter (albeit with my husband's name spelled incorrectly) included with my latest electric bill. It wasn't about some new, unfathomable aspect of energy deregulation. Rather, it had to do with technology-driven customer service. "We have recently invested in high-speed payment processing equipment in order to allow us to more quickly apply payments to customer's sic accounts," said the letter. "Unfortunately, the machinery, which automatically removes the contents from each payment envelope as the payment is being processed, is sensitive to paper clips and/or staples resulting in mutilated checks and misapplied payments. Please be careful not to staple or clip future payments to the payment coupon."

Well, that was a first! Naturally, my paranoid New York-born-and-bred husband vowed he would not comply—how could he not staple a check to the coupon? It might get lost! My thought process was more convoluted. First, reflection that high-speed imaging has reached the utilities industry, after years of acceptance and use in insurance. Then, observation that what the utility company is calling "customer service" is actually going to take money out of my checking account more efficiently. Third, I mused on the fact that the letter did not give me an option to pay my bill electronically—something that would eliminate paper cuts and mutilated checks forever (plus enabling the utility to get its proverbial hands on my funds even faster).

At this point, I must confess that I do not pay ANY bills electronically. I'm still in the check-writing, stuff-it-in-an-envelope mode (at least you don't have to lick stamps anymore). Chalk it up to a combination of inertia and anxiety—why change something that works? What if paying bills online doesn't work? I don't want to be a fraud statistic.

Even though pundits forecast that electronic bill payment and presentment is one of the next hot technologies to transform financial services, actual penetration into the bill-paying public remains relatively small. No doubt the numbers will change, just as it took 20-odd years for automated teller machine use to expand beyond the notorious "30 percent wall"—for many years, only a third of all retail bank customers could be persuaded to use ATMs. It didn't take any one carrot (incentive) or stick (fees) to convince people to rely on ATMs. It was a blend of generational change and aggravation with the inefficiency of the branch experience.

Similarly, EBPP—along with things like online insurance sales and other customer-focused financial transactions—will not gain critical mass until people are convinced there's no reason to do business any other way. Most people I know now believe there's no reason to actually walk into a bank branch. I guess one day I'll believe I can do without the staple on my utility bill payment, too.

Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & Technology in 1991. In addition to ... View Full Bio