Bill Payment Systems

Bill payment systems are platforms allowing customers to pay their bills through a payment network. Bill payments are for previously acquired products or contracted services and can be recurring (e.g. electric bills) or non-recurring (e.g. medical bills). In a payment system, the payment instrument can either be cash or non-cash.

Non-cash bill payment systems have seen a rapid rise in the last decade. The most recent payment system using paperless billing is electronic billing presentment and payment (EBPP). EBPP allows a company to present invoices, bills, and other information to their customers online, and allows consumers to view and pay their bills online. There are two kinds of online bill payment systems: buyer-direct and bank-consolidator. Both directly source payments to service provider from the customer’s bank account.

Debit card bill payment systems allow customers to send payments from one’s account directly to a vendor through POS terminals of ATM machines.

Electronic debit transfer is bill payment process initiated upon payee’s instruction. Payroll payment typically uses this method; employers pay their employers by authorizing the bank to transfer funds from their account to the employee’s account.

Credit card system transfers value from a credit line to the vendor’s account upon use of credit card for purchase of goods or services. The credit card holder is then required to settle their credit obligation at a specified billing period.