First Union Corp. is opening up a lead in letting customers receive and pay bills through its Web site.

Customers of the North Carolina banking company and of MCI Worldcom will now be able to get their phone bills on the First Union home banking Web site and pay them there too.

The big telecommunications company started presenting bills over the Internet this week, through Checkfree Corp. First Union has an agreement with Checkfree and is the only banking company to offer electronic bill payment and presentment in other than a test mode.

Charles Schwab & Co. and Morgan Stanley Dean Witter & Co. also do so. Bank One Corp. and PNC Bank Corp., both working with Checkfree, are expected to launch such a service soon.

"We're extremely pleased with the MCI Worldcom announcement, because of the increase in the number of bills our customers can receive on-line," said a spokeswoman for Charlotte-based First Union. "This all equals increased convenience and access for our customers."

First Union estimates that 5% to 10% of its deposit base bank on-line, but did not reveal the number that paid or received bills on-line.

MCI Worldcom, one of about a dozen billers using Checkfree's E-Bill system, is the first national telecommunications company to send bills and receive payments over the Internet, a Checkfree spokeswoman said.

It was faster than AT&T Corp., which is among 30 or so corporations still testing Checkfree's system, she said.

First Union pays Checkfree a fixed amount each month for each customer receiving and paying bills on-line. This covers payment, presentment and Checkfree's pay-anyone function, which pays bills to corporations that cannot accept them electronically. First Union receives a small fee from Checkfree for each bill presented to a customer.

"As more financial services companies are coming on-line with bill presentment, an even broader range of consumers can electronically receive and pay their core bills," said Peter Kight, chairman and chief executive officer of Checkfree.

With brokerages and other providers moving faster into electronic billing, some bankers are worried they will get cut out of the process, said Octavio Marenzi, research director at Meridien Research in Newton, Mass.

"There's going to be more and more banks that are going to start to play in this area," he said.

Residential customers of MCI Worldcom can enroll for electronic bill delivery and payment at the company's Web site or at Checkfree's.

Their bill summaries will be available on Web sites of the handful of companies using Checkfree's E-Bill: First Union, Charles Schwab, and Morgan Stanley. Users of Intuit Inc.'s Quicken software can also see their MCI bills.

After viewing the summary, customers can link back to the MCI Web site if they wish to view account details and pay bills.

Checkfree's E-Bill is the only payment and presentment system in use by major billers. The competing system of Transpoint, a joint venture of First Data Corp., Microsoft Corp., and Citigroup, is still in the testing phase.

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