Innovation In Bill Payment

Twice in his recent discussion with MPD CEO Karen Webster, Peter Kwakernaak, the CEO of AcceptEmail, compared his company to Apple.

Not that he was saying they were one and the same, mind you. Rather, Kwakernaak drew the comparison as an example of what he ideally hopes his company – an electronic payment solution that allows bills to be paid directly within an email, forgoing the need for manual data entry – could be.

A lofty aspiration, to be sure, but by no means an impossible one. Kwakernaak is nothing if not a forward-thinking pragmatist.

Acknowledging that the Amsterdam-based AcceptEmail – which Kwakernaak founded in 2006 – takes a unique approach to solving the problems of bill payments, Webster asked the former baseball player to pinpoint his inspiration in developing the service.

What struck Kwakernaak and his team early on was the fact that no solutions in place – be it a bank portal, a billing portal, or the like – were “really consumer-centric.” He simply thought about his experience with bill payment as a consumer, and what his ideal situation would be to handle the process from that side.

“We believe in pushing the bill,” he told Webster. “That doesn’t mean a notification that you can login to find your bill on somebody’s portal.” Rather, AcceptEmail is designed to present bills “at a place where [you are] very often. That’s either on your PC, tablet, or on your mobile – and that’s in mail.”

The proposition behind AcceptEmail, Kwakernaak notes, is that it “sort of seduce[s] consumers” and small businesses to pay bills as quickly as possible by integrating the very task with its own reminder.

“We took away all the unnecessary stuff, like registering and logging in and enrolling, which is all a bit of a drag.”

He described his company’s plan to whittle the process down to the bare minimum as a “bit of an Apple-ish approach” – his first such comparison in the conversation with Webster.

The signature within AcceptEmail, as Kwakernaak explains it, is the frame and banner. Tasks are color-coded (when a payment is due, for instance, the image is blue), and the color changes along with the status as certain tasks are fulfilled.

Talking about this SmartTech-driven technology, Kwakernaak remarks, “the nice thing about [it] is that [consumers] have proof of [their] payment in the same email. [They] don’t get…10 emails for one transaction – it’s just one. And the ‘payment request’ turns into a ‘payment received.’”

On the other side of this process is of course the biller, who experiences a similar interface. Rather than either party having to wait for the bank to turn up with a statement, Kwakernaak says “you know it instantly, on both sides. And that’s a pretty strong thing.”

AcceptEmail is a unique platform in that it does not require a user to register with it. Billers provide AcceptEmail with the data, almost like they would traditionally send that information to a printer. As an “output device” – as Kwakernaak describes his service – AcceptEmail creates messages and sends them out from the biller’s domain on its behalf. It’s “almost as if you substitute paper for digital,” the CEO states.

He explains to Webster that what’s required on the biller side is “as little as possible” – just a file that contains an email address, an amount and a payment reference, and, if possible, a salutation and full name of the customer.

There are three options provided to consumers for payment method: manual, which is most often done in collection situations, where call center agents create AcceptEmails on the fly; managed account, which Kwakernaak describes as a “Dropbox type” of file drop service; and a Web service.

AcceptEmail is not in the payment flow; the service does not process payments. While it does support “every real-time online payment method there is” (including examples such as PayPal and Amazon), in the case of credit or debit card payment, AcceptEmail relies on partners for processing.

“And the interesting part [of] that,” adds Kwakernaak, “[is] we sort of come in with gifts [for these partners], because we generate transactions for them. So they’re sort of ideal partners because we go to a volume, a stream of transactions that nobody really has tapped into that much.”

The AcceptEmail platform possesses the ability to enable a payment to be pushed through a consumer’s bank account, and Kwakernaak shares that he is “looking at some interesting initiatives in that area.”

“Access to the account” types of payment methods, according to him, are very popular in Europe. As for the United States, however, he sees a potential hurdle to such adoption due to his observation that “everybody’s pretty hooked up on the rewards you get from credit cards and debit cards.” So there is “some ground to cover before we are there.”

To this point, Webster offers that it will require a shift in mindset if U.S. consumers are to transition from primarily direct-debiting their bank accounts for the purpose of paying bills and move that process on to their credit cards.

The consumers in the U.S. who currently do utilize autopay for bills, notes Kwakernaak, are a minority – “not more than 30 percent, max.” AcceptEmail actively seeks to position itself as another option.

And here he makes his second comparison between his company and Apple: “Hopefully one day we [can be] Apple Pay for bills.”

Prompted to compare the kinds of billers that AcceptEmail is seeing interest from in the U.S. and the ones it presently deals with in Europe, Kwakernaak has found that “there is overlap, and there is difference.” The primary overlap, he states, occurs in the realm of insurance companies. The health care industry is where he sees a difference – because in the U.S., unlike in Europe, “there [are] an awful lot of bills coming from various health care institutions,” and is therefore a segment in which AcceptEmail is interested.

One segment in the U.S. where “the jury is still out,” notes Kwakernaak, is the field of charitable donations. His company is keeping an eye on it, to see if it could play a role in those types of payments.

Webster points out that it appears that the type of billers that are presently most lucrative for AcceptEmail are the ones that operate on a basis of recurring payments; Kwakernaak agrees with this assessment.

“They are [the] most lucrative,” he says, “because the volumes are [the] biggest. But, in all honesty, we are happy also with everything having to do with collections and reminders.”

He states that AcceptEmail has designs on “mov[ing] up in the value chain towards…initial billing,” be that in the form of one-off or recurring bills.

“But I believe the expression is,” he adds, “you should learn how to walk before you start running very fast.” For AcceptEmail to move into initial billing in the U.S. will take some time, as Kwakernaak notes that it did in Europe.

Asked by Webster if he can share any case studies related to reducing days outstanding for bill payments and getting past-due bills from the point of going into collections to actually getting paid, Kwakernaak is quick to point out one that AcceptEmail carried out with Santander Bank in the U.S.

In that instance, says Kwakernaak, Santander found that by utilizing AcceptEmail, they’ve “reduced the DSO (Days Sales Outstanding) [by] four or five days, [at] the same time reducing costs.”

He adds that T-Mobile is another U.S. company that has seen its DSO and costs reduced through its use of AcceptEmail.

Describing Kwakernaak as a “serial entrepreneur,” Webster wonders what differences he perceives in AcceptEmail compared to other businesses he has started, founded, and/or ignited.

It’s “different in a couple of aspects,” according to Kwakernaak.

Firstly, the success of the business to business company is based on consumer behavior, which is a new experience for Kwakernaak, having come from a purely B2B background. Billers will only jump on board if consumers want to use AcceptEmail to pay them.

Given that Kwakernaak has experience playing professional baseball, Webster can’t resist asking him to draw parallels between that game and his current experience with AcceptEmail.

“I believe there are a lot of similarities between…sports and entrepreneuring,” says Kwakernaak. He points to the importance of a never-quit, can-do attitude, teamwork, and the reality that “the harder you practice, the luckier you get.”

“And we practice real hard,” he concludes.