In taking the wraps off their updated bill payment service, Metavante Corp. and Digital Insight Corp. have added presentment capabilities and shed some light on one of the bill-pay market’s recent mysteries: Whatever happened to Spectrum.
The revamped product was created by Metavante, Digital Insight’s longtime technology partner.
Digital, of Calabasas, Calif., also works with CheckFree Corp., and lets its bank customers incorporate either CheckFree’s or Metavante’s technology into their online banking packages.
CheckFree, of Atlanta, has provided presentment features to Digital Insight’s customers since 2002, but this increasingly popular capability was lacking in the Metavante product. (Digital Insight, which announced the updated service on Thursday, would not say how many of its more than 1,400 customers use each provider.)
Ed McLaughlin, the vice president of business development for electronic presentment and payments at Metavante, said, “this will bring presentment to a lot of banks that didn’t have it before.”
Bill pay has become an online banking essential. Bill presentment, which delivers billing information every month directly to customers, is likewise considered a big selling point. Banks that do not have it complain that billers, which can present invoice information on their Web sites, are capturing the lion’s share of bill-pay transactions.
The formal name of the product, Bill Payments and Presentment by Metavante, is notable for what is omitted. Mr. McLaughlin said it has its roots in the Spectrum EBP LLC payment service, which was developed by Wells Fargo & Co., J.P. Morgan Chase & Co., and Wachovia Corp.
Though Spectrum came with a solid pedigree and its technology was well regarded, it languished, and was eventually acquired by Metavante in 2002.
Even after Metavante combined Spectrum with its own bill-pay capabilities and reintroduced the Spectrum Network in 2003, it garnered little attention.
Metavante and the banks that first created the system “never really got it off the ground, and it floundered for a really long time,” said Beth Robertson, a senior analyst at MasterCard International’s TowerGroup Inc. research unit in Needham, Mass.
“They’re probably tired of people saying, ‘What’s going on with Spectrum?’ ”
Mr. McLaughlin explained the renaming of the service by saying that although the Spectrum brand “is certainly not something we’ve abandoned, there’s a perception in where Spectrum started.”
Several Digital Insight customers tried out the system in the second quarter, and it is now available to all of its customers, Mr. McLaughlin said.
Metavante, a subsidiary of the Milwaukee banking company Marshall & Ilsley Corp., calls the new service an upgraded version of its bill-pay offering and says it is more tightly integrated with Digital Insight’s online banking service. Features include alerts, transaction records, and the ability to present scanned paper bills.
Alenka Grealish, who manages the banking group at the Boston market research firm Celent Communications LLC, said the updated service complements Digital Insight’s work with CheckFree.
Digital Insight’s allowing its customers to choose CheckFree or Metavante is akin to a merchant’s letting customers pay by Visa or MasterCard, Ms. Grealish said — more options could lead to more sales. The enhanced Metavante service could appeal to customers who did not want to use CheckFree, she said.
Penny Gillespie, a senior analyst at Forrester Research Inc. of Cambridge, Mass., said that Metavante’s software could offer small banks a feature that even the large banks generally do not have. “It sounds like what they’re doing with Digital Insight is using Spectrum technology to enable its banks to do on-us transactions,” and that could lower processing costs for the banks, she said.
Part of the original vision for Spectrum was to develop a system wherein participating banks could treat on-us transactions separately from the normal outflow of bills, Ms. Gillespie said.
This capability was included in the initial Spectrum concept, and Mr. McLaughlin said it is integral to the current product. “It’s directly in line with what the original Spectrum vision is,” he said.
