Electronic Bill Payment

Electronic bill payment is a feature of online banking, similar in its effect to a giro, allowing a depositor to send money from his demand account to a creditor or vendor such as a public utility or a department store to be credited against a specific account. The payment is optimally executed electronically in real time, though some financial institutions or payment services will wait until the next business day to send out the payment. The bank can usually also generate and mail a paper cheque or banker's draft to a creditor who is not set up to receive electronic payments.

Most large banks also offer various convenience features with their electronic bill payment systems, such as the ability to schedule payments in advance to be made on a specified date, the ability to manage payments from any computer with a web browser, and various options for searching one's recent payment history: when did I last pay Company X? To whom did I make my most recent payment? In many cases one can also integrate the electronic payment data with accounting or personal finance software.

Limitations (United States)

Typically, US financial institutions formally prohibit the use of their consumer electronic bill payment systems for payments to any tax authorities, collection agencies, or recipients of court-ordered payments like child support or alimony. Any organizations or individuals outside of the United States are also usually excluded. Payments to government agencies for utilities such as water are usually permitted.