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Online banking emerging as payment alternative for e-retailers
E-retailers including TigerDirect and Tool King are letting customers use Secure-eBill to pay through their personal bank’s online billing service. “Our average sale is about 50% higher than for other payment options,” Tool King’s Don Cohen says.
Managing Editor, B2B E-commerce
E-retailers including Tool King LLC, TigerDirect.com, Action Village Inc. and CompSource Inc. are offering customers the option of using Secure-eBill to pay through their personal bank’s online billing service. “Our average sale is about 50% higher than for other payment options,” Tool King managing partner Don Cohen says.
Tool King, which has been offering Secure-eBill for about a year at ToolKing.com, has found that about 60% of the customers who use it are new to the retailer, Cohen says. “We thought initially that a new payment option would just take away from our existing payment options, but that hasn’t been the case,” he says. Tool King is No. 302 in the Internet Retailer Top 500 Guide to Retail Web Sites.
Marwan Forzley, president and CEO of MODASolutions, the provider of Secure-eBill, says that a 60% new-customer rate is average among retailers using the service. He adds that, on average, Secure-eBill accounts for between 2% and 7% of all purchases at retailers using the service-a range confirmed by Cohen.
The service is particularly popular among shoppers who prefer not to use a credit card, Cohen and other retailers say. “This payment option has strong appeal to customers who shop at TigerDirect.com, but are not able or don’t want to use a credit card online,” says TigerDirect CEO Gilbert Fiorentino. TigerDirect is a unit of Systemax Inc., No. 26 in the Internet Retailer Top 500 Guide to Retail Web Sites.
Shoppers who pay through Secure-eBill choose it as an option during the online checkout process. A first-time use requires the shopper to add the retailer’s payment process information into her bank’s online bill-pay system; subsequent payments can be made by choosing Secure-eBill logo during checkout, which provides a direct link to the shopper’s online banking web page. Secure-eBill also provides the option of e-mailing a bill to the shopper, who can click a link in the e-mail to pay through her online banking system.
MODASolutions charges merchants 1% to 1.5% of the value of transactions, depending on volume-a rate that Cohen says is lower than other payment options.
To promote the use of Secure-eBill among shoppers, TigerDirect is currently offering first-time users a free USB Flash drive.
Although shoppers could use their online banking systems to pay retailers outside of Secure-eBill, MODASolutions promotes it as a streamlined and easier way to link from a checkout page to the banking page. And for the retailer, Secure-eBill offers an integrated application that lets merchants reconcile their records in reports that show how each payment matches each order, Forzley says.