The Cost of Convenience: Paying Your Utility Bills

Many utility companies now accept payments over the phone or online with a credit card, debit card, electronic check, or bank transfer. While these options are convenient, consumers often are charged a fee for this service. In addition, there is no guarantee that payments will be credited to a consumer’s account in a timely manner. The Office of the Ohio Consumers’ Counsel (OCC), the residential utility advocate, recommends knowing the facts before paying utility bills online or over the phone.

Convenience fees

For the convenience of online or over the-phone payments, a customer may be charged a fee each time a payment is made. Before using these methods to pay your bill, be sure to check if any charges apply for the service.

Processing times

Paying bills by the due dates is essential for maintaining service. When paying a bill over the phone or online, the OCC encourages consumers to pay bills well in advance of the due date.

To avoid disconnection while payments process, customers facing disconnection should pay their bill in person at an authorized agent. Prior to making the payment, contact the utility to confirm you are making a payment at an authorized agent. Once the payment is made, the customer should call the company and provide the payment confirmation or authorization number. An updated list of authorized agents can be obtained by calling the utility company or by visiting the company website.

Typical processing times:

Payments in person. Many utility companies have payment centers or authorized agents that will accept and post payments within one business day. However, unauthorized companies are under no obligation to send payments to the utility company in a timely manner.

Payments online. While most online payments will post the day the payment is made, some may take up to five business days before they are reflected on consumers’ accounts.

Payments over the phone. Payments made over the phone usually post within one to five business days. Ask the company representative how long it will take to process the payment.

Bill payment services

Bill payment services provide customers with the ability to manage utility bills online. These are third-party companies that receive bills and make payments on behalf of the consumer. Banks may charge a monthly fee for using this service. In addition, payments may take up to five days to post to consumer accounts.

Online security

When making financial transactions online, the Federal Trade Commission (FTC) and the OCC encourage consumers to take extra precautions. Here are a few suggestions:

• Always use a secure browser, and only make payments from secure websites. To make sure the browser or website is secure, verify that the “lock” icon is in the browser’s status bar and the phrase “https” is in the web address when you enter your payment information and submit your payment.
• Always read the privacy policy before providing personal payment information to a website. In particular, find out how the information will be used and if it will be shared with others.
• Keep records of your online transactions and retain confirmation numbers.
• Review your monthly credit card, bank and utility statements for any errors or unauthorized payments. For more information about making financial transactions online, call the FTC at 1-877-FTC-HELP or visit the agency on the web at www.ftc.gov.

Authorized payment agents are various establishments, like grocery stores, that contract with a utility company to accept bill payments. Contact your utility company for a complete list of authorized agents. Different agents may charge different fees for this payment service.

Automatic withdrawals provide the convenience of no check writing, no waiting, and no late fees. On a monthly basis, the bank will electronically transfer the total amount of the bill to the utility company. In most cases, consumers continue to receive a hard copy of the bill. Some banking institutions may charge a fee for this service.

Bill payer service agents use the Internet to receive bills and make payments on behalf of consumers. Each bill is paid on the date scheduled using the consumer’s banking or credit card information.

eBills are monthly statements that are available online instead of through the mail. This may also be referred to as “paperless billing.” Many companies let consumers pay their bill online at no cost if they are enrolled in the company’s eBill or paperless billing program.

Electronic checks can be used with most over-the-phone and online payments. Payments are deducted from the consumer’s bank account and transferred to the utility company.

Online payments are made using an Internet service or by authorizing a bank to transfer a payment to the utility company. With this method, consumers are typically emailed a bill notification and payment confirmation.

Over-the-phone payments are made with the assistance of an automated system, customer service representative, third party payment agent, or by using a touch-tone phone to enter payments from a bank account or a credit or debit card. Some companies may charge a fee to speak to a live person.