Banks and billers like to talk up how much they've saved in stamps after switching customers to e-statements and e-bills. They may actually be saving more in customer service costs.
People who sign up for electronic bill presentment through online banking are more than twice as likely as those who receive paper bills to use electronic self-service channels to resolve issues, the vendor Fiserv Inc. says. Self-service channels are cheaper for the bank to operate than call centers and branches.
Customers receiving electronic bills from their bank were 64% less likely to call a live customer service representative each month than those receiving paper bills, Fiserv says. Those receiving electronic bills from the biller were 39% less likely to call a representative than those receiving paper.
Instead, they used self-service channels such as online banking. Customers receiving e-bills from a bank made 1.57 self-service visits, compared to 1.37 visits for those getting bills directly from the website of Consolidated Edison Inc., which participated in a yearlong study Fiserv published Monday.
Banks spend around $4 for each call center call, says Nicole Sturgill, research director at TowerGroup.
Fiserv's findings resemble what some top banks have seen.
"Our data shows that customers through our online and mobile banking services, [including electronic bill presentment], adopt an array of electronic, alert and information capabilities over time," says Adam Vancini, senior vice president in charge of money movement solutions for the Internet Services Group at Wells Fargo & Co., of San Francisco.
As these customers interact more online, Wells Fargo tends to see other types of electronic engagement, including self-help, Vancini says.
Wells Fargo provides electronic bills from 460 billers, including Con Edison. It has nearly 20 million active online banking customers, the bank says.
Banks and billers could potentially benefit from e-bills in other ways. Customers receiving electronic bills are 22% more likely to pay bills on time, while those receiving bills from Con Edison were 6% more likely than those receiving paper bills, Fiserv says.
"One reason is that the consumer gets the [electronic] bill sooner than paper, and if they are at the bank site, more often than not they will also be doing bill-pay activities," says Eric Leiserson, senior research analyst for Fiserv, which is based in Brookfield, Wis.
It's also likely that if customers have gone through the trouble of setting up electronic bill presentment, they have set up automatic bill pay, Sturgill says. This helps them pay more bills on time, she says.
Those who sign up to use e-bills may be more affluent and well-educated to begin with, experts say. This makes them more likely to interact with online service channels.
"E-bills may not necessarily be the cause of this," says Ron Shevlin, senior analyst at Aite Group LLC of Boston.
Vancini disagrees. He would not divulge how many customers have signed up for bill presentment, but he says e-bill users are not necessarily more educated or affluent, in contrast to the early days of online banking.
"It has moved past the first-mover category and there is generally a diverse segment of customers using e-bills," Vancini says. "They are not necessarily tech-savvy."
About 3,000 of Fiserv's bank customers offer electronic bills, including several of the top-10 U.S. banks. Fiserv delivers bills for more than 400 billers.