Pros & Cons of Online Bill Pay

Pro: Time Management

• Online bill pay can save a considerable amount of time each month. Automatic payments take the money directly from the payers account each month. Consumers do not have to initiate the action, write a check or prepare an envelope for mailing. Even consumers that use an online bill pay system that is not automatic can save time on paying the bill. The consumer visits the company site and arranges to transfer money from a bank account to the utility company.
  
  

Pro: Avoid Late Payments

• Automatic bill pay prevents missed or late payments and avoids the associated fees such as late charges and interest. Automatic payment arrangements take the money when the bill is due without worry about delayed mail or other issues that can cause a late payment.
  
  

Pro: Less Paper

• Paying bills online uses far less paper than the traditional method for paying bills. Consumers can elect to receive monthly bills through email and avoid the paper copy in the mail. The customer can elect to print a receipt after paying the bill to keep records at home.
  
  

Con: Fees

• Some companies may charge a fee to make a payment online. Utilities and companies that use a third party company to handle online transactions typically charge a fee for each transaction. Western Union offers customers the option of instant payments, but charges a small fee each time the customer uses the service. Forgetting a deposit can result in overdraft fees when the automatic bill pay attempts to transfer money that is not available in the account.
  
  

Con: Missed Errors

• Automatic bill payment plans can cause some customers to miss errors in the monthly bill. When the bill is paid automatically each month, the customer may forget to keep track of the statement from the billing company. Unusual charges may be missed on the monthly bill.
  
  

Con: Online Security

• Customers must research the bill pay company to ensure that financial information is secure online. Banks and financial institutions are secure with financial information and the risk is very low, but customers must be careful to review the transactions each month.