Billing Concepts Corp., a publisher of bills for telephone companies, has agreed to invest $10 million in Princeton Telecom Corp., an electronic bill payment and presentment processor.

The deal would give Billing Concepts a 22% equity stake in the New Jersey company, which processes about $250 million of consumer payments a month for 700 billers through an electronic lockbox.

Billing Concepts, whose customers include 1,300 local telephone companies and 400 long-distance carriers, creates and mails paper bills on their behalf. Rather than build its own electronic delivery system, it will team up with a company that "has been active in this technology and is well established in this marketplace," said Parris H. Holmes Jr., president and chief executive officer of San Antonio-based Billing Concepts.

"Our telecom customers have expressed a strong interest in publishing their bills and receiving payment over the Internet," he said.

Through Billing Concepts, Princeton Telecom gains valuable relationships with billers. "We get more than money, we get all their customers," said Donald Licciardello, chairman and chief executive of Princeton Telecom.

The company's decision to nurture relationships with billers through Billing Concepts does not bode well for banks, said Gary Craft, analyst at BancBoston Robertson Stephens.

"This is disintermediation of the banks," Mr. Craft said. "If I were a bank, I would want to resell this portfolio of services to a customer. The bank would be the point of contact."

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