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Fast Facts About Direct Payment

  • Direct Payment is a smart way to make recurring payments of all kinds, including loan and insurance payments, newspaper subscriptions, health club membership dues, utility and cable bills, and charitable contributions.
  • Some people may still refer to Direct Payment as automatic bill payment, automatic debit, electronic bill payment or direct debit.
  • Direct Payment is reliable, accurate, on time and confidential. Research shows that Direct Payment can help you save and invest more each month while reducing late payment fees.
  • Problems with Direct Payment are rare. If a problem ever does occur, it is easy to resolve - just call your billing company.
  • When making payments electronically, your account is protected by federal regulations. Under the Federal Reserve Board's Regulation E, your financial institution is required to investigate any electronic payment that you believe to be in error, provided that you notify your financial institution.
  • According to NACHA - The Electronic Payments Association, Direct Payment increased by 5.3 percent to 3.1 billion payments in 2005.
  • More than half of all U.S. households use Direct Payment for at least one recurring payment and four out of five consumers who use it say they are very satisfied with it.
  • Many companies offer incentives to encourage you to sign up with Direct Payment. These incentives can include lower interest rates on loans, vouchers for free service, sign-up gifts and more. Contact your billing companies to find out if they offer any Direct Payment incentives.

Did You Know

An average household receives 20 bills each month. As postage costs continue to rise, each household spends close to $100 a year for stamps alone. Direct Payment not only eliminates postage expense, but also the cost of checks, which can be another $30 per year, and the possibility of being charged late fees.

What People are Saying

"I use Direct Payment for as many things as I possibly can. I utilize a credit card which I pay off every month, and my goal is to write one check each month and have everything else electronically debited from my account.

The reason I do this is simple - I'm a miser. And (without Direct Payment), you're paying for checks, you're buying envelopes, you're putting stamps on them, you're taking the time that it takes to go to the mailbox. If you have a busy schedule, that can be very annoying."

- Major Tracy Hunt,
Homestead, Fla.