Giro - Electronic Bill Payment

Electronic Bill Payment

Modern electronic bill payment is similar to the use of giro.

Advantages include:

• Instant access to the funds via an ATM, debit card or cheque card.
• There is no paper cheque that can be lost, stolen, or forgotten.
• Payments made electronically can be less expensive to the payer; typically electronic payments may cost around 25¢ (US) whereas it could cost up to $2 (US) to generate, print and mail a paper cheque. Banks may not even charge for the service at all; for example in Finland some banks charge nothing for electronic payments inside the SEPA (Single Euro Payments Area).

In the United States, the Automated Clearing House (ACH), regulated by NACHA-The Electronic Payments Association and the Federal Reserve Bank, handles all interbank transfers, including direct deposit and direct debit.

In entirely electronic bill payment, the payer receives a bill — either physically by mail or electronically from a website (electronic billing). Then, the payer reads in the information from the bill, either manually or by using the barcode on the bill, enters it to the form on the bank website, and submits the form. The payment is immediately deducted from the account balance.