Increasingly, companies of all sizes and types have been jumping on the digital payments bandwagon to increase collection efficiencies, cut down on late payments, and bolster customer satisfaction. For many, this includes a move to electronic billing presentment and payment (EBPP) solutions that let them deliver customers’ statements electronically rather than via paper-based methods and enable customers to “opt-in” (enroll) to view their bills and make payments online.
Growth Afoot
Electronic billing presentment—also known as electronic invoicing or e-invoicing—is on a growth trajectory. According to a report by Technavio, the market will exhibit a compound annual growth rate (CAGR) of more than 19 percent, trending upward by $6.93 billion for the forecast period spanning 2020 to 2024.
A similar report by Zion Market Research pegs the global e-invoicing market as generating approximately $20.52 billion by 2026, up from about $4.649 billion in 2018 and representing a CAGR of around 20.4 percent.
These projections are not all that surprising given the return on EBPP investment. Consider this catch-all statement from a “Worldwide Electronic Survey” published by global consulting firm Ernst& Young (EY): “Adopting an electronic invoicing solution allows you to realize cost reductions, economies of scale, efficiencies, and improved accuracy.
Meeting the Need for Speed and Savings
Let’s dig a little more into the benefits afforded by EBPP. Speed tops the list. One reason this is so: Consumers who have opted in for EBPP receive an email that their bill is ready to be viewed—just as soon as the merchant generates it. There is no waiting for a bill to arrive in the mail; the invoice referenced in the email can be opened immediately. By most estimates, nearly half of consumers who receive bills electronically remit payment the same day.
For merchants, there are fewer collection woes, with less time spent and less effort expended chasing down customers for payments that are late or have not been received. Obstacles to prompt payment—like bills or checks lost in the mail, invoices not received in time to meet the payment due date, and inadvertent misplacement of bills after delivery to recipients—disappear or are greatly diminished. Industry statistics indicate that EBPP alone leads to an immediate 15 percent reduction in late and missed payments with EBPP alone.
Significant savings in generating invoices also await businesses that opt for the electronic bill presentment element of EBPP. According to a “Global eInvoicing Report” produced by the Federal Reserve Bank of Minneapolis, making a move from paper-based bill presentment methods to a digital invoicing platform yields a savings of $4 to $8 per invoice.
Increasing Customer Convenience and Satisfaction
Further adding to the appeal of EBPP, the electronic payment element opens doors for a convenient, streamlined payment experience—an experience consumers favor. In many customers’ eyes, it is far better than writing a check, finding a stamp, and remembering to mail a payment—or alternatively, visiting a business to make an in-person payment (especially during a pandemic).
Consumers are also more satisfied and more loyal (and less likely to pay bills late) when they have access to flexible payment options—and that includes EBPP. And consumers do want flexibility in their payment methods: E-Complish’s research has shown that 32 percent of consumers use more than three bill payment methods every month, and 43 percent are more satisfied with companies that have multiple billing and payment options.
Topping it off, sustainability is a hot topic these days, and many consumers want to do business with merchants whose practices are more environmentally responsible. Converting to EBPP fits the bill. Do the math: Generating 1,000 paper bills takes 336 pounds of paper, 1,241 pounds of wood, 3,733 gallons of water, and 1,446 pounds of greenhouse gas. Converting 20 percent of these paper bills to electronic invoices would save three household garbage bags of trash and five gallons of gasoline, with 747 fewer gallons of wastewater flowing into U.S. waterways.
Selecting an EBPP Solution
All these benefits notwithstanding, businesses must consider several factors that come into play when choosing the most effective EBPP solution and solution partner. “The factors can include how technical options offered by different software suppliers fit your company’s existing IT profile, your company’s activities, the number of invoices you issue, format requests and the needs of third parties, such as suppliers and customers,” the EY report states.
Learn more about E-Complish’s EBPP offering or schedule a consultation here.