FIS and Oracle Team to Digitize Utility Bill Payments

FIS is teaming with Oracle to remove paper checks from the utility billing process.

The FinTech company announced Tuesday (Nov. 12) that its BillerIQ solution, running on the Oracle Cloud Infrastructure, will allow Oracle — which manages billions of utility customer bills each year — to roll out electronic bill delivery.

“The utility sector has historically used traditional payment methods,” Seamus Smith, group president of global automated finance at FIS, said in a news release. “However, with smart meters and digital payment technologies like mobile banking and e-wallets, consumers now expect to pay bills digitally. The inefficiencies and fraud risk of paper checks add to the challenges faced by the utility industry.”

And in spite of their costs and inefficiencies, the release noted that 75% of organizations still use paper checks for bill payments. With BillerIQ, customers can more easily deliver bills and accept digital payments for things like electricity, gas and water bills.

The tool offers multiple payment options, FIS added, including ACH, credit, debit, Realtime Pay and digital wallets.

The 75% figure quoted above lines up with research by PYMNTS Intelligence, which has found that three quarters of organizations continue to rely on paper checks, in spite of the high costs and inefficiencies associated with them.

The manual processing involved with checks leads to slower transactions, raises the potential for errors and can mean longer days sales outstanding (DSO), affecting a company’s cash flow and financial stability.

The deficits of paper checks are clear in industries such as construction, where 76% of subcontractors receive payments through checks. This method led to a staggering $273 billion in losses due to slow payments in 2023.

“Additionally, costs associated with issuing checks — ranging from $4 to $20 per check — exceed the minimal cost of digital transactions, which is about 30 cents per transaction,” PYMNTS wrote earlier this year. “This discrepancy highlights an opportunity for businesses to transition from legacy payments to more efficient digital alternatives.”

Opting to use digital payment channels can streamline the payment process, effectively lowering DSO and bolstering financial health. Consider that 83% of companies said fully embracing electronic payment processing is critical, while 79% of vendors say they prefer digital payments, such as wire transfers, automated clearing house transactions and virtual cards, because of their quicker processing times.

“Digital payment portals enable suppliers to receive payments easily and securely, offering features like supply chain financing and discounting to encourage timely payments,” PYMNTS wrote. “These advancements contribute to better cash flow management and stronger business relationships.”