Adding Princeton eCom Boosts Expedited Payment Plans at ORC

Relying in part on its recently completed acquisition of Princeton eCom Corp., Online Resources Corp., Chantilly, Va., plans to roll out a real-time expedited payments service for its banking-client base by the first quarter of next year, Matthew P. Lawlor, chief executive of the company, tells Digital Transactions News. The service, according to Lawlor, will enable last-minute payers to get near-instantaneous credit for bill payments. “We're not just talking about same-day [payments],” he says. “We're talking about real time.” The acquisition of Princeton, for which Online Resources paid $180 million (Digital Transactions News, May 10), has accelerated the introduction of this new service by bringing a network of some 1,600 billers to its new parent, whose strength lies in its ties to the banking market, Lawlor says. Princeton eCom's biller base, he says, represented the largest such network among bill-payment processors, relieving Online Resources of having to establish multiple business relationships with billers and biller service providers. Such links are critical to making real-time account updates possible. “With Princeton, we go a long way toward that critical mass [of billers],” says Lawlor. On top of Princeton eCom's technology and biller relationships, Online Resources adds its own 10-year history in routing debit transactions through more than 60 ATM processors, a key component to processing expedited payments made with so-called PIN-less debit. With PIN-less debit, consumers pay bills online with their debit card accounts but without entering their PINs. The application has been allowed for certain biller categories, including utility companies and mortgage lenders, by several of the nation's electronic funds-transfer networks. “Our No. 1 acquisition target was Princeton because it brought us management and distribution capability to extend our real-time PIN-less capability,” says Lawlor. Enabling last-minute electronic bill payments is turning into a top priority for bill-payment processors. With one in five U.S. bill payers having made an expedited payment in the past 12 months, and with researcher TowerGroup projecting that total expedited transactions will grow from 554 million in 2005 to 1.7 billion by 2010, the market is proving to be an increasingly enticing one for billers, banks, and processors. The twist some processors are adding, however, is the ability to post real-time credit for payments. Besides Online Resources, Metavante Corp. this week announced it is entering expedited payments with a service it says will allow consumers to pay bills with credit and debit cards, PIN-less debit, and automated clearing house debits. The new service offers both same-day and real-time capability, the Milwaukee-based processor says, though it did not release the number of biller connections it has established. In a conference call Monday to discuss second-quarter results with analysts, Lawlor announced Ronald W. Averett, chief executive of Princeton eCom and the designated head of the combined companies' e-commerce businesses, had decided to leave. “We have mutually decided to part ways,” Lawlor said. “He's a proven and capable CEO, and that's what he should be doing. We want to let Ron pursue his next CEO challenge.” The company also released statistics indicating it processed 14.2 million bill payments in the quarter, up 26% from the year-ago period. It supported 1.1 million bill-payment users for its banking clients, up from 858,000 in 2005's second quarter, representing a 10.5% adoption rate, up from 9.5%. Its banking client base grew 19% to 877.