First the U.S. Postal Service strikes a deal with CheckFree Corp., the undisputed leader in electronic billing and payment, to offer a USPS-branded electronic bill presentment and payment (EBPP) service. Now Pitney Bowes, the Stamford, CT-based mail preparation and delivery automation service provider, has purchased a relatively small California company with an EBPP solution that seems to have staying power. Could it be that the ultimate winners in EBPP will be "old world" organizations that have become proficient at handling paper?
Alysis Technologies Inc., Emeryville, CA, formerly IA Corp., had been languishing as a vendor of image-based remittance systems until new management took over and changed the company's name and its product line just over a year ago. In March, when Pitney Bowes announced it would acquire Alysis, now a business-to-business e-billing software house, for $24 million, Alysis' shares were trading at $1.39.
Gary Craft, an e-finance analyst with FinancialDNA.com, sees the purchase as a great move for Pitney Bowes. "This company could become a meaningful player in e-bill presentment," he says.
No doubt that's the expectation at Pitney Bowes. The company claims a client roster in excess of 2 million businesses across more than 130 countries, including seven businesses that were also clients of Alysis. Some of those common customers were the Post Office of the United Kingdom, Aetna Insurance and Detroit Edison.
"By combining Alysis' technology, talent and customer base with our customer reach, products and service capabilities, Pitney Bowes will be poised to take a significant position in the growing digital delivery environment," said Michael Critelli, chairman and chief executive of Pitney Bowes, in a statement announcing the acquisition.
The Alysis acquisition isn't Pitney Bowes's only foray into the world of e-commerce. The company also offers escrow services for B-to-B exchanges.
VeriSign Takes First Data Stake
eriSign Inc., the Internet security company based in Mountain View, CA, has struck a deal with eONE Global LP, an emerging Internet payments unit created last year by Atlanta-based First Data Corp. The deal calls for the companies to co-market each other's products, and for VeriSign to make a $20 million equity investment in eONE Global and its SurePay Internet payments business.
VeriSign, considered a pioneer in the digital certificates business, has been involved with Internet payments since late 1999, when it purchased Signio Inc., a business and consumer payments company with an estimated 15,000 merchant customers. What VeriSign has lacked, however, is a direct link to the merchant acquiring side and the settlement services that only acquiring banks can support. The result is that its customers must maintain multiple vendor relationships to support online payments.
First Data is considered the largest provider of payment card acquiring services, plus it has relationships with more than 1,400 credit and debit card-issuing institutions. It launched eONE Global and its SurePay last year in an effort to extend into the Internet payments arena.
Plans are for VeriSign and SurePay to "seamlessly" integrate B-to-B payment solutions, and create end-to-end payments for technology companies on the Web. Products will include: registration, authentication, trade finance, secure payments processing and settlement, and customizable reporting services.
"What's most important here is that leading industry players are coming together, bringing their respective 'best in class' offerings to fuel both the growth of the business-to-business (industry) as well as online commerce between merchants and consumers," said First Data chairman and chief executive Ric Duques, in a statement announcing the deal with VeriSign.
Capital One Joins NACHA
ACHA, the Electronic Payments Association, has rewritten its rules for membership, and has added its first new member in more than a decade: Capital One Financial Corp., the Falls Church, VA, holding company for credit card issuer Capital One Bank.
NACHA, which began life as a unit of the American Bankers Association (ABA) in the 1970s, was originally an association of regional automated clearinghouse (ACH) associations. In the late 1980s, by then no longer a part of the ABA, NACHA opened up membership to individual banks with large ACH operations. Nearly a dozen of the largest banks joined at that time, but several have merged or been acquired since, resulting in shifts in NACHA's membership and shrinking dues collections.
In addition to financial institutions, NACHA also counts hundreds of companies as affiliates and/or members of special industry councils.
Earlier this year, NACHA reorganized and decided to let any financial institution join as a full member, not just those with ACH shops. Capital One is the first of this expected new crop of members.
New Rules for Internet Checks
ew ACH rules were an-
nounced in March that support the origination of ACH debits in the form of Internet checks. ACH rules, written by NACHA, the Electronic Payments Association, are intended to provide a uniform framework for ACH transaction formats and define the rights, obligations and warranties of parties to various types of ACH transactions-debits as well as credits.
The latest rules are clearly intended to keep NACHA in the Internet payments loop. They create a new category of ACH transactions, known by the transaction code WEB, that are authorized by consumers via the Internet and that post against their demand deposit (checking) accounts. The new rules also set out requirements for companies that offer ACH payment options that debit from customer checking accounts. Included are requirements for the implementation of commercially reasonable fraud detection systems and annual security audits.
NACHA has also prepared a new guidebook for Internet merchants who want to use the ACH payment mechanism: Understanding Internet-Initiated ACH Debits.
"As e-commerce matures, consumers and businesses will expect to have payment choices...," a NACHA executive says.
