The bill payment software company Billeo Inc. says it has beefed up its offerings in an effort to persuade more people to pay bills online with credit and debit cards.
The Santa Clara, Calif., company already offered a toolbar add-on for Web browsers that lets people gain access to a directory of biller sites, many of which accept card payments. On Monday Billeo introduced an enhanced version that stores payment history.
In consolidating bills through one application, the toolbar resembles the online bill payment service banks offer, with a few key differences.
Many people who use Billeo "never had a solution to take care of their needs," such as letting cards be payment options or allowing same-day payments, said Murali Subbarao, Billeo's chief executive. "Banks never stepped up to it."
Some banks feel the same way — at least, their card-issuing sides do, he said. "Not only the credit card side but the debit card side."
Through a relationship with Visa U.S.A., Billeo has been working with several issuers that offer a link to the Billeo biller directory from their card sites.
Tom Kelly, a spokesman for JPMorgan Chase & Co., said his company supports it because "our goal is always to increase use of debit cards … . If people want to use the debit card to pay their bills, it gives them an opportunity to do that," while Chase.com does not.
Billeo is also working with some banks on a "converged solution," Mr. Subbarao said, which would allow card payments from bank's bill-pay sites. (He would not give details on the converged product)
Mr. Kelly said JPMorgan Chase is open to such an arrangement, but offers nothing like it now.
Mr. Subbarao would not say how many people use its toolbar but said the number has been growing by about 20% a month. More than half the people that use his software use cards to pay their bills; the rest authorize payments through their bank accounts.
Though Billeo's toolbar encourages people not to use their banks' Web sites to pay bills, Mr. Subbarao said his product is unlikely to experience the same fate as other companies' products that encouraged the same habit.
Yahoo Inc., for example, said this month that it would discontinue its bill-pay service. "From my perspective, Yahoo had an uphill battle" because its service offered little that was different from what people could get from their banks, he said. By offering card payments and now a transaction history, Billeo exceeds bank sites' capabilities, Mr. Subbarao said.
James Van Dyke, the founder and principal at Javelin Strategy and Research in Pleasanton, Calif., said adding features may not address the most serious challenge facing Billeo. Companies such as Yodlee Inc. and Intuit Inc. offer their own flavor of bill payment, he said, but people generally prefer to use their banks.
"Companies like Billeo, Yodlee, Intuit with Quicken, and others sometimes mistake this for being about technology rather than trust," Mr. Van Dyke said. "While consumers constantly complain about their banks, by far they trust them more than any other entity."
Banks do not give customers everything they want, he agreed. "Banks have been moving too slowly to have the right consolidated bill-pay services," he said, but they will eventually catch up.
Red Gillen, a senior banking analyst at the market research firm Celent LLC, said one advantage for Billeo is that banks are on its side.
Indeed, working with Billeo may help banks attract people who crave the advantages of biller-direct payments and have avoided the bank's site only for that reason.
Ultimately, "people are looking for convenience," he said. People who want the advantages of both consolidation and biller-direct payments "would use this for all of their bill payments," he said.
