Billserv.com Inc., which handles electronic billing for corporations, has agreed to deliver its customers' bills through MasterCard International's massive Remote Payment and Presentment Service network.
The San Antonio company has 21 corporate customers representing 600 million bills annually. Billserv is one of several service providers that have signed on to distribute bills through the Mastercard network. The agreement gives it access to more online banking customers. MasterCard says it is connected through its 14-year-old network, formerly known as Remittance Processing Service, to 95% of the businesses and consumers that are sending and receiving electronic bills.
The Purchase, N.Y.-based credit card association is preparing a test of its electronic bill presentment service beginning next month and plans to formally introduce it in September. MasterCard would be a neutral routing switch between companies working with corporations to deliver bills and those working with consumers to receive bills.
Billserv offers services to customers such as Sallie Mae, Chevron, and Ultramar Diamond Shamrock, and is working with Spectrum, a bank-owned, third-party service similar to MasterCard's.
Michael Long, chairman and chief executive officer of Billserv, said it is becoming abundantly clear "that banks have now gotten over their shyness of how they will enter the market, and are clearly stepping up to the plate aggressively."
Much is at stake, including Billserv's ultimate survival. The company late Thursday reported first quarter revenues of only $6,426. It lost $2.07 million. There is no comparison to the first quarter in 1999 since Billserv was not operational then and did not generate revenues.
Mr. Long said consumers have been very slow to request electronic bills and therefore his company's revenue is low. But he said there are signs that adoption of electronic bills, now less than 1%, will pick up in the latter half of 2000. He said he expects his company to become profitable in two years.
Billserv's stock fell $1 for the week, closing Friday at $14.9375.
"You certainly could not make a business out of today's adoption rate, but what this is about is positioning," Mr. Long said. "When the adoption rate does kick in, then everybody will be well positioned."
