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

About Norway, BBS and banking services in Norway:

Some key figures on Norway…

Population Number of banks Bank offices Bank accounts PSTN/ISDN telephones Mobile telephones Internet connections Internet bank users Cabel TV 4,55 mill.

144 1.348

12,5 mill 3,0 mill 4,0 mill 1,6 mill 2.1 mill 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

eFaktura B2C development

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

customer –

co-operation between banks

mass” between Biller and his in order to ensure “critical • Further development might include B2B and other documents

Value network and infrastructure presentation

Value network E-billing B2C

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

Partners Billers BBS Banks Private customers

Value network and infrastructure presentation

Infrastructure e-billing B2C

Biller A Biller B Biller C Biller D Biller E

BSP

Euronova EDB IT drift Enita Ergo Ephorma BBS

“e-billing Hotels”

BBS Consolidator

Payment request Agreements

Netbank 1 Netbank 2 Netbank 3 Netbank 4 Netbank 5 Bill receiver A Bill receiver B Bill receiver C Bill receiver D Bill receiver E

Status and trends 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

Late comers Late majority Eearly majority Eearly users Innovators Today nearly 30% percent of all Internet bank users use eFaktura

Growth factors

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

Brand building and sales organisation

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

Business users campaigns – marketing mix

National mass communication (BBS) Industry oriented magazines Newspapers Internet Public Relations From partners (Direct comm.) One to one sales Direct mail Advertising Promotion on websites Customer magazines End user (business) From banks (Direct comm.) One to one sales Seminars Direct mail Information on web-sites Brochures Sales competitions

Brand building and sales organization

Marketing mix

National mass communication from BBS TV Radio Internet Public relations From billers Message on paper bills Bill attachment Media advertisement Internet banners Information on home page Customer magazines Incentives Local public relations End user From banks Attachment to statement of account Intensive enrolment capturing Information in the Internet bank Information on other bank portals “Order form” Information in branches Customer magazines Local public relations

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) Linked to every Norwegian Banks and billers who offers eFaktura

Exposure on the web

Web Partner Net bank Advertising Biller

Increasing knowledge eFaktura

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

Målgruppe: 25-50 år og nettbankbruker Høst 2006 Vår 2006 Høst 2005 Vår 2005 Høst 2004 Vår 2004 16 15 10 7 13 Først nevnt 22 20 16 7 10 13 9 Deretter nevnt 54 56 60 62 60 57 Hjulpen 0 20 40 60 80

Total knowledge

94 89 86 82 80

100

76

Outlook

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

Marianne Arveng

Business manager EBPP [email protected]