Question : Why do banks promote online bill pay so much?
Do banks make money somehow by having people pay their bills online? If anything I would think that banks have to pay money to mail the payments that don't post electronically and they would also lose revenue from checks. I've seen banks give free checking accounts and even prize drawings for the people who use bill pay. Whats the motivation???
- asked by Jay
All Answers:
Answer #1
They charge a processing fee for each transaction,so yes they do make money from each time you do it
- answered by Peter A
Answer #2
banks loan out ninety percent of the money theytake in for savings.. checking accunt deposits...they are required to keep a certain percent.. tokeep up with the law they make small term loansfrom other banks overnite loans.. if you pay yourbill on line they get the money faster.. if youpay by check it has to go through a clearinghouse.. and it takes longer.. so they dont have toborrow as much when you make on line payments.. okgilermo
- answered by daddyporky@verizon.net
Answer #3
Do you really think your Bank is doing anyfunction in which they don't make money from thetransaction? Of course they are making money, espsince thee are no human labor hours involved.
- answered by RWLake
Answer #4
It's much cheaper to process than physicalcheques, and online bill paying gets countedagainst your monthly transactions, so if youraccount gives you five per month but you pay sevenbills, they get your monthly fee plus the twoextra charges, plus whatever else you do eachmonth. So not only are they not spending thecheque-processing money, they're making money ontransactions that cost them next to nothing to do.It's worth promoting and giving away prizes ifthey think that the promotion will cost them fivepercent of the revenue they think it will bringin.
- answered by Gravy
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