Electronic bill payment is a feature of online, mobile and telephone banking, similar in its effect to a giro, allowing a customer of a financial institution to transfer money from their transaction or credit card account to a creditor or vendor such as a public utility, department store or an individual to be credited against a specific account.
From the consumer's point of view, electronic payment of bills is cheaper, faster, and more convenient than writing, posting and reconciling cheques.
In addition, though limitations exist, a wider range of bank accounts or credit cards can be used for the electronic payment of bills.
[1] For banks the advantages of electronic bill payments are a reduction in processing costs minimizing paperwork and an increase in customer loyalty.
[2] In the United States, most banks and credit unions offer a free service typically called "bill pay."