Bottomline Technologies Inc. is teaming up with Lockheed Martin Information Management Services to offer software that electronically garnishes wages for child support payments.
Portsmouth, N.H.-based Bottomline makes the software, and Lockheed Martin markets the product to state and local child welfare agencies. Financial terms were not disclosed.
The software - a modified version of an automated clearing house program Bottomline acquired when it bought Certisoft Inc. - electronically transfers payments from a child support payer's employer to that company's bank.
The bank then forwards the funds to the appropriate collection agency, which pays out the child support.
Funds transfer is accomplished using electronic data interchange technology and the automated clearing house network.
"By incorporating electronic commerce into the collection effort, we are reducing processing costs and increasing the security of our payment process," said Craig Goellner, director of the Family Support Registry, which is run by Colorado's Department of Human Services.
Each year, 80 million child support payments worth a total of about $10 billion change hands in the United States, said John Insko, vice president at Bottomline Technologies.
Industry experts declined to predict how many of those payments would eventually be turned into electronic transactions.
A Denver-based child support payment registry is the first to use the software. The registry helps collect payments from about 260 people in the Denver area.
Officials at the registry said the software eases the burden placed on employers, which usually are required to make out paper checks and send them to the proper distribution points.
Executives at Lockheed Martin expect to be able to land other users for the software in coming months, based on the Teaneck, N.J.-based company's contacts with child support agencies in Colorado, Arizona, New York, Hawaii, Arkansas, and Los Angeles County.
According to Mr. Insko, Fleet Financial Group offers a competing product for garnishing wages.
