USPS puts stamp on online billing
- By Natasha Haubold
- Apr 10, 2000
The fear of losing billions in revenue has pushed the U.S. Postal Service
to deliver an online service for electronic billing and payments.
USPS announced April 5 that it would immediately offer customers the
option of paying their bills online through a secure World Wide Web portal.
The Postal Service is partnering with CheckFree Corp. and YourAccounts.com
to present the online service, called eBillPay.
In the arrangement, USPS serves as a neutral third party, similar to
the role it plays when delivering printed mail, said USPS spokesman Gerry
Kreienkamp.
The move to offer online services is USPS' attempt to survive in a market
that is moving toward electronic messaging and is bypassing postal services,
said William Kovasic, a procurement lawyer and visiting professor at George
Washington University who specializes in USPS.
"The USPS had to make this move or it would be a failing firm," he said.
"[USPS'] future is at risk without change. This raises the question of what
the role of the USPS will be in the future."
Nearly two-thirds of all recurring bill payments, such as mortgage and
utility bills, are delivered by USPS every year. If all bills were paid
electronically, USPS could lose $15 billion to $18 billion in revenue annually.
That's why USPS wants a leadership role in how the transactions are completed,
Postmaster General William Henderson told postal workers during a convention
last week.
"Since the earliest days of this country, the Postal Service has been
there to connect Americans in every neighborhood and city with each other,"
he said. "Today we are reaching out to make sure that universal service
is also available in our country's newest community — the online community."
Located on the USPS Web site (www.usps.gov), eBillPay will enable the
Postal Service to remain competitive vs. commercial handlers such as UPS
and Federal Express, Kreienkamp said. "We are looking for new revenue bases,"
he said. "Any business or government agency needs to utilize the modes and
means of technology that its customers are using to be competitive."
USPS' eBillPay will give customers a central place to pay their bills.
Unlike commercial sites, which require an individual pass code for each
transaction, eBillPay customers enter the site once and can pay everyone
they wish.
Customers enrolled in eBillPay select the companies or people from whom
they want to receive electronic bills. Those billers will then send bills
electronically through the Postal Service system, which distributes the
information to the customer.
After viewing the bills online, the customer can pay them electronically
and specify the payment date. Money will be taken directly from the customer's
account and electronically transferred to the biller's account.
Customers can use e-billing even if a bill is not sent electronically through
the USPS Web site. USPS would send a check to the specified biller, Kreienkamp
said.
All transactions are secured with user names and passwords, and a Secure
Socket Layer is used to prevent outside inspection. The system also uses
40-bit and 128-bit encryption to make information unreadable as it passes
via the Internet. "We have taken every precaution possible to prevent someone
from accessing information," Kreienkamp said.
In the next few months, eBillPay customers also will have the option
of attaching an electronic postmark to every transaction. It would verify
who sent the transaction and provide a receipt when payment was received.
The postmark also would notify the sender and the recipient if the document
had been tampered with.
Despite USPS efforts to allay security concerns, industry experts question
its ability to handle dramatically new programs such as e-billing.
"Even if the technology is superior, trying to do something like this
will inevitably create talk about what the USPS is doing," Kovasic said.
"It is going to be hard to be successful because of the existing status
of the USPS as a [government]-owned institution, and the policies they must
follow are not complementary with new product development."