Some top banks say they mail more paper than ever, in part because many consumers who sign up for electronic statements don't always agree to stop receiving the paper ones. The vendors that are affected by consumers' lack of enthusiasm for e-statements include Doxo Inc., Hearst Corp.'s Manilla and Pitney Bowes Inc.'s Volly.
These companies promise to facilitate the transition to e-statements by helping consumers organize their bills online. Some ask billers to pay them a cut of the savings when they stop mailing statements.
These vendors won't get that revenue if consumers don't cut off paper completely. The vendors also get revenue from advertising and referrals.
But for these companies to succeed, these revenue streams may not be enough.
"Even if paperless adoption soars, the viability of these firms will rely on somebody being willing to pay for it," says Ron Shevlin, a senior analyst at Aite Group LLC of Boston.
While consumers have flocked by the millions to third-party financial management providers such as Intuit Inc.'s Mint.com, such services are free. Mint has said that referrals are not a continuous source of revenue, since most of the customers who switch accounts do so just once.
"Consumers don't want to pay for [providers like Mint]," Shevlin says. "They don't even want to pay for their checking accounts."
If these vendors are going to make money on paper suppression, banks must overcome consumers' fears over losing access to their financial records, experts say.
Banks don't have consistent messaging across product lines, says Jim Schinella, executive vice president of business development and sales for Manilla Inc. This leaves consumers confused about whether they can access their statements when they need them.
"As a consumer, it is not necessarily clear that the archiving strategies at banks are even the same," Schinella says.
The vendors say their services can actually assist banks in their efforts to help consumers turn off paper by also helping them organize it.
"Banks struggle more than any other industry with the variety of documents they send," says Steve Shivers, chief executive of Doxo, of Seattle.
Still, it's the document storage providers, as much as banks' swamped consumers, who would benefit from the banks sorting out their paper problems.
