eFaktura

eFaktura- Norwegian EBPP solution

Establishing a successful inter-bank EBPP solution: the Norwegian "eFaktura" project

Agenda:• About Norway, BBS and banking services in Norway• eFaktura B2C development• Value network and infrastructure presentation• Status and trends• Growth factors• Brand building and sales organisation• Outlook

Some key figures on Norway…

Population 4,55 mill.

Number of banks 144Bank offices 1.348Bank accounts 12,5 mill

PSTN/ISDN telephones 3,0 millMobile telephones 4,0 mill

Internet connections 1,6 millInternet bank users 2.1 millCabel TV 0,9 mill

About Norway, BBS and banking services in Norway:

About BBS

• BBS is a leading provider of clearing services to Norwegian banks

• The business is built around 4 product areas– Card services– Giro and bill payment services (including EBPP) and

Information services– Interbank services– Trusted services

• The company is owned by the Norwegian banks

About Norway, BBS and banking services in Norway:

Banking services in Norway

• Population of 3,5 million above 18 years– “Everybody” has a bank account– Currently around 2.1 million internet bank users

• Debit cards are predominant– over 90% of all card use– Insignificant use of checks (0,5%)– Fraud related to payments and use of cards is insignificant

• Bankers’ associations have strong positions and support– History of high degree of self regulation and cooperation within the banking

industry

• Businesses already have electronic communication with their banks, with integration to legacy systems

About Norway, BBS and banking services in Norway:

E-billing B2C in Norway

• Market– One solution, eFaktura (operated by BBS), which nearly all banks

are offering to their customers.

• Solution– Bills presented through Internet banks, independent on the billers

selection of bank or selection of bank for the private customer (everybody to everybody). Easy to add new services offered to billers.

• Business model– The banks enter into a contract with billers and/or bill receivers

– Thin model – BBS is the only consolidator and BBS has an agreement with all banks

– Service providers and banks delivers value added services to billers and banks to their private customers.

eFaktura B2C development

The strategy

• Initially establish a solution for electronic bill presentment and payment towards the B2C segment:– all-to-all bank neutral solution– bill presentment in the internet bank– integration with existing payment solutions– enhance interactive communication between Biller and his

customer– co-operation between banks in order to ensure “critical

mass”

• Further development might include B2B and other documents

eFaktura B2C development

Value network E-billing B2C

Banks

BillersPrivate

customers

Partners

BBS

Partners help billers with eFaktura integration

1. Integration partners• Tailor-made integration• Off-the-shelf solutions for

chosen segments

2. ERP software vendors • Off-the-shelf solutions for

existing ERP software

3. Bill Service Providers• Bill detail presentation• Add-on services

Value network and infrastructure presentation

Infrastructure e-billing B2C

Euronova

EDB IT drift

Enita

Ergo Ephorma

BBS

Biller A

Biller B

Biller C

Biller D

Biller E

“e-billing Hotels”

Consolidator

Payment request

Agreements

BBS

Bill receiver A

Bill receiver C

Bill receiver D

Bill receiver E

Bill receiver B

Netbank 1

Netbank 3

Netbank 4

Netbank 5

Netbank 2

BSP

Value network and infrastructure presentation

Bills:

- Totally 19 million bills since

we started in 2001– 9,4 million bills in 2006

_ 350 billers (+ proximately 80 in pipeline”)

Agreements:– Currently over 2 150 000

agreements between billers and end users

– Nearly 700 000 unique users, nearly 30% of all net bank users

Other:– All net banks on solution– ERP support representing 80%

of companies with ”modern ERP systems” installed

Status and trends

The adaption of eFaktura

Innovators

Eearly users

Eearly majority

Late majority

Late comers

Today nearly 30% percent of all Internet bank users use eFaktura

Status and trends

Success factors

• Value network / business model established

• Growth facors– User incentives– Enrolment capturing

• Market approach– Brand building– Sales organisation– Campaigns

Growth factors

User Incentive from billers

• Different models from billers:– Fixed deduction from

bill for EBPP customers

– ”eCustomer”-concept covering all electronic communication with customers

• No plan to implement incentive models in Net banks

€2,50/month incentive introduced in 2002, this biller has currently 25-30%

of their customers using eFaktura

Enrolments per month

Growth factors

Enrolment capturing

• Enrolment suggestion in the Internet banks– When a user pays a

bill from an EBPP biller ”manually”

– From payment history

• ”One-click” enrolment– No need to enter user

ID or EBPP reference

Enrolment capturing gives a 8 to 30 times increase in

enrolments per day for a net banks - overnight

Enrolments per month

Growth factors

Supporting the brand and the banks

Brand building• BBS responsible for brand

building /strategy and mass communication efforts– Providing a common:

• Communication strategy• Brand strategy• Visual identity

• Banks, billers and BBS run parallel marketing

• BBS develops common marketing material

Sales support from BBS• Supporting banks in sale

process towards new billers• Supporting banks in helping

billers marketing towards end users

• Supporting banks in improving net bank functionality

Brand recognition in Norway: 80 percent

Brand building and sales organisation

Business users campaigns – marketing mix

From partners (Direct comm.) From banks (Direct comm.)One to one sales

Direct mailAdvertising

Promotion on websitesCustomer magazines

One to one salesSeminarsDirect mailInformation on web-sitesBrochuresSales competitions

National mass communication (BBS)Industry oriented magazines

NewspapersInternet

Public Relations

End user(business)

Marketing mix

From billers From banksMessage on paper bills

Bill attachmentMedia advertisement

Internet bannersInformation on home page

Customer magazinesIncentives

Local public relations

Attachment to statement of account Intensive enrolment capturingInformation in the Internet bankInformation on other bank portals“Order form”Information in branchesCustomer magazinesLocal public relations

National mass communication from BBS

TVRadio

InternetPublic relations

End user

Brand building and sales organization

Communication strategy

Focusing on what we know is most motivating

– Easier and faster way to pay (just one click)– Time saving– You dont have to type the billing details– Receive the electronic bills into the Internet bank

istead of paper bills in the ordinary mailbox– Curious on new technology, trying something new– More control

Communication focus

Dont expect people to run and buy the service

• Therefore we tell people to ”say yes” to eFaktura, next time they visit their Internet bank.

• Enrolment capturing– (The customers have a higher acceptanse of messages right after bill

payment).

Communication strategy

Focusing on what we know is most motivating

• Cost-effectiveness, focusing on what they save each year

Marketing/advertising PM

Our solution to create attention and desire of action to a low interest service like eFaktura

• Make a stop-effect, do the unexpected• Persuade the customer when he/she is near the point of

action (Internet, paper-bills, radio)• Continuous brand exposure. • Dominate the chosen media, to not compete with

advertisements from high interest products/services.• Make the press to tell about it

Stop effect

An invoice is not very exciting

Until you start playing with it

Advertising material

Brand web site (www.efaktura.no)

Linkedto everyNorwegianBanks and billers who offers eFaktura

Exposure on the webPartner

AdvertisingBillerNet bank

Web

10

7

7

10

15

16

9

13

13

16

20

22

57

60

62

60

54

56

0 20 40 60 80 100

Vår 2004

Høst 2004

Vår 2005

Høst 2005

Vår 2006

Høst 2006

Først nevnt Deretter nevnt Hjulpen

Increasing knowledge eFaktura

What kind of payment solutions for regulare bills du you know? (n=371)

Målgruppe: 25-50 år og nettbankbruker

86

82

80

76

89

Total knowledge

94

Outlook and further product development

• Product development

– Distribution of other documents with eFaktura

– Secure customer dialogue from the eFaktura bill – ok developed 2006

– B2B

• Biller-centred enrolment

• Increased CRM and customer dialogue focus

• Incentive solutions

• One-stop-shopping paper/electronic services

Outlook

Marianne ArvengBusiness manager EBPP

marianne.arveng@bbs.no