For most consumers and small businesses, Bill Pay has looked the same since they signed up for online banking. Schedule a payment, the institution debits the checking account, the biller gets paid by check or ACH. The model is dependable. It is also frozen in time.
In the years since Bill Pay was introduced, the way people move money has changed in almost every other place they spend. They tap a card to ride the subway. They earn points on groceries. They float a large purchase to next month's statement. Bill Pay is one of the only recurring financial activities that has stayed bound to a single funding source.
Pay by Card changes that. It is the first meaningful innovation in Bill Pay in a generation, and it will bring the experience in line with how people already manage the rest of their money.
Customers will be able to add a credit or debit card to Bill Pay and use it to fund any payment. The biller still gets paid the same way they always have. The customer gets the flexibility of a card. Both sides of the transaction stay inside digital banking.
That is the whole feature. The complexity sits underneath. The customer experience is straightforward.
For consumers and small businesses, Pay by Card opens up three things their existing bill pay experience cannot.
Rent, utilities, insurance, contractors, vendors. Customers will be able to earn points or cash back on the bills that move the largest share of their monthly spend. Until now, those rewards have only been available through a card issuer's app or by routing payments outside their bank.
A consumer with a tight checking balance can keep a payment moving. A small business owner waiting on a customer invoice can pay a vendor on time and settle up later. Either way, the payment happens. The relationship with the biller stays clean.
Customers will not have to bounce between bill pay, card issuer apps, and standalone payment tools. Every bill, every funding source, one screen, inside the digital banking they already trust.
For the financial institution, Pay by Card is a chance to bring activity, data, and revenue back to digital banking that has been migrating elsewhere for years.
Card-based bill payment is one of the activities customers have been most likely to take outside their bank, paying directly through biller portals or third-party tools to use a card. Pay by Card will give them a reason to do it inside your digital channel instead.
Every bill paid through your digital banking is a signal. What customers pay. When they pay it. How they choose to fund it. Card-funded bill payment adds a new layer to the picture, and it is data the institution would otherwise never see.
When a customer pays a bill with a card your institution issued, there is interchange upside. The magnitude depends on your card issuance footprint, but the relationship economics shift in your direction either way. Card activity that used to leave your institution now contributes to it.
There is no added risk and no operational lift on the institution's side. The biller continues to receive payment the way they always have.
Bill Pay is not going away. It remains one of the most-used, highest-retention features in digital banking. What is changing is what customers expect it to do.
The financial institutions that bring this kind of innovation into digital banking are the ones consumers and small businesses keep coming back to. The ones that do not are the ones watching activity migrate to apps and biller portals that own the customer relationship a little more each year.
Pay by Card is a small change to a feature most institutions have not touched in two decades. The customers using it will notice. So will the ones who leave because their bank did not.
Pay by Card will let Bill Pay customers fund a bill payment with a credit or debit card alongside their existing bank account. It will be available to both consumer and small business bill pay users.
No. When the feature is live, customers will see a card option alongside their existing bank accounts in Bill Pay. They add a card the same way they would in any payment experience.
No. The biller continues to receive payment by check or ACH as they always have. The card simply funds the transaction on the customer's side.
No. Autobooks and our payments partner handle card processing. No card data is stored by the financial institution.
When a customer funds a bill payment with a card the institution issued, there is interchange revenue tied to that transaction. The broader value is engagement and transaction data staying inside the institution's digital channel.