by Michelle Sprecher

Created on: July 24, 2008   Last Updated: September 15, 2010

Bill pay services through online banking will free you from checks and mail. You can virtually pay any company or person by electronic money transfer or paper check sent by the bank. It is available 24/7 from a bank near or far from you.

How does online banking bill pay work? To get started, enroll for internet banking by using your account number or bank card along with your PIN (Personal Identification Number) and your social security number. Create a username and a password. Security questions and answers are used to help identify you if you should forget your password or log in from a different computer. Your data is encrypted and security layers are used to prevent fraud when you use online banking and perform transactions.

Once you have signed up for online banking, you can enroll in the bill pay service by entering all the payees of your bills. You should have handy the statements with the names, account numbers and payment addresses of the bill. Also locate the phone number where the payee can be contacted. After setting up all the information you will be ready to schedule payments for the dates you want the payment to arrive. Most banks offer these transactions within two to four business days of the request or schedule them for a certain date. The funds are then deducted from your chosen account on that day.

Simply schedule your pay dates and let the bank worry about getting the money there on time. Don't worry if you change your mind, you can make changes to the amount and date or cancel the payment up to the date you see that the payment is pending. Also sign up for Ebills and payment reminders.

One thing to remember while paying through a bill pay service is that it will not be instant, unlike if you were to pay at an individual site. However, you can save time by scheduling all your bills at once and only need to remember one sign in username and password. Know exactly when the money will be paid too. When you schedule bill paying online, you will avoid late fees and delayed mail service also.

Banks offer you a risk free guarantee (on time and correct) so you can be at ease about paying your bills online. Take a test drive of a bank online demo to see how easy it is. These tutorials make learning about online banking and bill paying effortless.

Not all banks offer the same service, so do your homework before you pick a bank to sign up for online banking and bill paying online. For the most part banks that offer online banking do so for free, but bill paying online can differ from bank to bank. The amount of days for scheduling the payments in advance can differ. Being offered as a free service verses charging a fee for this service should be considered when signing up for bill paying online. For some banks a monthly fee of about $7 can be tacked on for use of this service if you do not carry a required minimum balance in your personal accounts and if you use more transactions than they allow, you can be accessed a transaction fee for additional transactions.

Start by researching your current bank for information on the services that they offer. A bank customer service representative can help you get signed up and on your way to having more control and freedom over your finances. Online banking and bill paying online are tools that are easy to use and well worth the time and cost savings. Maintaining your information for your accounts can be made at anytime and from anywhere. You will be amazed at how these tools simplify the bill paying process!

In addition, some accounting programs can be used along side the online banking, simplifying your finance life.

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