It looks like bank executives are finally understanding what net geeks
and blind people have known for years: online bill pay is an
exceptionally convenient and useful service that saves time and makes
life easier.  It can be used as a tool to keep fickle customers and offer
them more services.

For blind people who are uncomfortable writing paper checks independently
with a typewriter or by handwriting, bill pay offers an easy and
accessible method to write a check to nearly anyone.

The big news this week is that the biggest bank in the Midwest and
southwest, Bank One, has jumped aboard the free bill pay bandwagon.  It
will offer free bill pay for 80 percent of its customers.  Those without
direct deposit will still have to pay.  The bank offers free bill pay to
all blind customers, regardless of account type or status.   The article
below shows that other Midwest banks are already offering free bill pay
as well, such as Fifth Third Bank and National City Bank.  don't be
surprised to find a bank in your community offering free bill pay.

Kelly






The Indianapolis Star
July 31, 2003


    Fees drop for online bill paying

More old-line lenders are cutting charges for Web banking

    How local companies' fees stack up

. Bank One is dropping its monthly fee for paying bills online,
  following in the tracks of some competitors. Here's a roundup of
  monthly charges for online bill pay:

. Bank One: $4.95; free starting Aug. 1 except for "Basic One" customers

. Fifth Third: Free

. First Indiana: $4.95, then 30 cents each after first 20

. First Internet Bank of Indiana: Free

. Huntington: $4.95

. Key Bank: $5.95

. National Bank of Indianapolis: $4.95 then 35 cents each after first 20

. National City: Free

. Old National Bank: $6.95

. Union Federal: $5.95, then

. 50 cents after first 10

. Union Planters: $5.95

. Note: Online bill pay may be free with select checking and other
  accounts. Regular checking account fees still apply. Excludes
  promotions and free trial offers.

. Source: Bank Web sites as of July 30

    By Chris O'Malley

[log in to unmask]


    Once considered a novelty for Internet geeks more than willing to
pay for the thrill, online bill paying has gone so mainstream that it's
increasingly being offered for free.

    Chicago-based Bank One, the largest bank in Indiana and the nation's
sixth-largest, on Wednesday said it will drop its $4.95-a-month online
bill-pay fee on Aug. 1 for most -- or 3.6 million -- of its checking
customers.

    Regional competitors Fifth Third and National City already dropped
their online bill-pay fees over the last year, making them more
competitive with Internet-only banks.

    "It was very common for brick-and-mortar institutions to charge a
fee for their online bill pay," but not Internet-based banks, said Greg
McBride, an analyst at Bankrate.com.

    "So for an established brick-and-mortar to drop that fee is
noteworthy."

    That's especially true at Bank One, which has been recognized in
industry circles over the years for being particularly adept at
harvesting fee income on the retail side.

    Eliminating the bill-pay fee "is a very strategic move, a
longer-term move," said Jim Bruene, publisher of Online Banking Report.

    "The customers that use it are very loyal to the institution that
offers it. . . . We'll have more retention," said Patrick Schubach, Bank
One's retail district manager in Indianapolis.

    Previous industry studies have shown that online bill-pay customers
tend to have higher incomes and education -- and more complex banking
needs.

    Last fall, giant Bank of America, with an estimated 20 percent of
the online banking market, dropped its bill-pay fee. "That kind of put
the pressure on everyone else, large and small," said Bruene.

    One of the nation's first Internet-only banks, First Internet Bank
of Indiana, dropped its online bill-pay fee in 1999, when only about
one-third of its customers paid bills online.

    "Now we're closer to 70 percent of online customers using bill pay,"
said Nicole Lorch, vice president of marketing and technology at the
Indianapolis-based virtual bank.

    While brick-and-mortar banks are gaining some parity with scrappy
Internet-only banks, the latter continue to fight back with more
competitive rates.

    NetBank and ING Direct, for example, tend to offer consistently
higher rates on savings products such as certificates of deposit in
Bankrate.com surveys, said Bruene.

    First Internet Bank of Indiana touts higher savings rates than many
of its traditional bank competitors. Internet-only banks "tend to be
pretty aggressive on their deposit products," said Bruene.

    Whether banks that drop online bill-pay fees will lure customers to
switch banks remains to be seen.

    Consumers often wince at switching, especially after they've gone
through the trouble of typing in payment addresses of vendors because
"it's a pain," Bruene said.

    He suggests customers at banks that currently charge online bill-pay
fees ask their banks to drop the fee, first.

    Call Star reporter Chris O'Malley at 1-317-444-6081.


VICUG-L is the Visually Impaired Computer User Group List.
To join or leave the list, send a message to
[log in to unmask]  In the body of the message, simply type
"subscribe vicug-l" or "unsubscribe vicug-l" without the quotations.
 VICUG-L is archived on the World Wide Web at
http://maelstrom.stjohns.edu/archives/vicug-l.html