DENVER, Jan. 12 /PRNewswire/ -- Throughout the recession and recovery, the utilities industry has faced increased pressure to better manage cash flow. The rate of shutoffs has increased dramatically for most utilities and collection costs are increasing as well.
Although industry analysts expect utility bills will increasingly be paid electronically, the current economic situation has actually resulted in an increase in check writing as consumers work to pay down credit card balances. Electronic payments processor ePayments Corp. CEO Paul Lufkin notes that this trend comes at a time when the utility industry would rather avoid the increased costs of paper check handling.
"The utility industry is upside down, the rate of shutoffs in this sector is up and they have some very difficult choices to make," said Lufkin, whose electronic payments processing company has unified payment systems for the utility and power industry through measures that include streamlined electronic check recovery for NSF items.
Because of the costs involved, utility shutoffs are usually the last resort when it comes to getting customers to pay their bills. Lufkin notes that manual disconnects can easily cost utility companies $300 per shutoff.
"Utility companies, for example, are still sending out a truck and a crew to disconnect service due to an NSF check, only to turn around a few days later and turn it back on," noted Lufkin. "In most cases, it costs them more than they can charge back to the customer since the public utilities commission sets those rates."
Lufkin said incorporating a unified payment system with more payment options such as credit cards and web or telephone payments (the costs of which are incurred by the customer) -- along with an integrated electronic check recovery system -- is key in developing a strategy to improve cash flow and reduce costs. Several of Lufkin's telecom clients, for example, have seen 50-percent declines in monthly non-sufficient funds (NSF) items they receive using ePayments' iSmart Rapid Recovery System for a year, also reducing manual disconnects and reconnects.
"Our NSF recovery process reduced their in-house collections by 80 percent while reducing bank return charges by 50 percent. They truly see the managed electronic recovery service we provide as win-win," said Lufkin.
Lufkin oversees the ePayments Group of Companies, providing more efficient and less-costly electronic technologies, which the debtor pays for, not the utility. The technologies include third-party processing of re-presented check recovery utilizing the ACH (Automated Clearing House) Network. Electronic check recovery shortens the collection cycle, and re-presenting electronically allows for one extra presentment for a total of three. This reduces the costs associated with returned checks and reduces the number of expensive service cutoffs and reconnects.
ePayments Corp. specializes in working with schools, non-profits, governments, banks and companies of all sizes that handle payments in the form of paper checks, electronic checks (ACH) and credit card transactions. Since U.S. banking system rules were changed to allow businesses to use the ACH and Check 21 methodologies to electronically process checks from customers, a new industry of providers has emerged to support businesses with electronic check conversion, electronic NSF recovery and related compliance services.
About ePayments Corp.
Offering a complete range of merchant check and credit card payment processing and support services, ePayments helps businesses, governments, schools and non-profits that receive non-cash payment transactions to reduce their risk while increasing cash flow. Unlike the traditional support players, ePayments has evolved the technologies and processes associated with accepting checking payments to reduce the costs required to process all forms of payment. Services include electronic returned check recovery (RCK), electronic check conversion (ARC), Check 21 (C21) conversion, check authorization, check guarantee, check-by-phone/web, consolidated returns, Electronic Payments Compliance Assessments and credit card processing. For more information on ePayments Corp., call 303-486-0850 or visit www.epaymentscorp.com.
SOURCE ePayments Corp.