If you’re tired of writing and sending out checks for monthly expenses, enrolling in online bill pay might be a good solution.

Online bill pay is a service offered by many financial institutions that allows customers to pay their bills electronically. It’s secure, free and can be done from the comfort of your home.

There are numerous advantages to online bill pay — especially for those accustomed to online banking — but there are some areas where it may fall short.

What is online bill pay

Online bill pay is an electronic payment service offered by many banks, credit unions and bill-pay services. It allows consumers to make one-time or recurring bill payments through a website or app. Consumers may also be able to schedule future payments.

With recurring bills, consumers can set up automatic payments for each month (or however frequently the bill is charged). There’s typically no limit to the number of bills that can enrolled in online bill pay, meaning that credit card bills, rent payments and utility bills can be viewed and paid all in one place.

Usually, online bill-pay services work by having a linked checking account where the funds are withdrawn from. Some banks refer to the account that pays the bill as the “pay from” account, while the business or individual who receives the bill payment is designated as the “pay to” account.

Because online bill pay bypasses the need for paper statements, it is an environmentally friendly alternative to paper bills. It also can help consumers keep their bills organized and not have to worry about a paper statement getting lost or accidentally thrown away.

How to set up online bill pay

To set up online bill pay through a financial institution, you’ll first need to be enrolled in online banking.

On the online account page, there’s typically a bill-pay tab, which may prompt you to undergo an extra enrollment to be able to use the service. The bill-pay page is where specific billers can be set up. You’ll need a copy of each bill you want to pay through online bill pay, and enter the information from the bill — such as the payee’s name and address — to set it up online and link it to your account.

Once the biller is enrolled, choose whether you want the bill to be a one-time or recurring payment. If you schedule payments for the future, make sure to keep track of your checking account balance, so that the automatic withdrawal won’t overdraw the account.

Many banks allow consumers to set up email or text notifications for when a new online bill arrives, or when the account is at risk of an overdraft, which can help consumers stay on top of their account balance.

Online bill pay can also be set up using a money management app. Some apps that offer online bill pay are Prism, Quicken and QuickBooks. Like online bill pay through a bank or credit union, these apps allow you to make one-time bill payments or recurring payments in one place. They require the additional step of linking an external checking account to withdraw payments from.

Pros and cons of online bill pay


  • All bills are in one place: You’ll be able to easily access each upcoming or past bill, as well as payment history, from the bank website or bill-pay app.
  • Payments can be automated: Setting up automatic payments makes it less likely that a bill will be forgotten. The day that it’s due, it’s automatically withdrawn from your account.
  • It’s environmentally friendly: No more paper statements means less paper going to waste.
  • Online bill payments are secure: Mailing checks comes with the risk of a check getting stolen or lost in the mail. Though there’s still a risk of cybercrime, online bank accounts have measures in place to protect transfers of funds.


  • There’s a risk of overdrawing your account: If you don’t keep track of your account balance, there’s a chance that recurring bill payments might withdraw more funds from the account than what’s available, which could result in lofty overdraft fees.
  • Fraudulent charges might be missed: It’s easier to miss scam charges when payments are automatic and online. Make sure to review statements and look out for any unusual charges.
  • It may take several days for the online payment to process: If you don’t give enough time to make a bill payment before its due date, the online payment processing might take longer than anticipated and incur a late payment fee. Bank of America recommends scheduling payments for at least five days before the bill is due.

Is online bill pay safe

Online bill pay is included with an online bank account, and online bank accounts are generally very safe. Banking sites protect your accounts in a number of ways, including multifactor authentication, alerts for suspicious activity and website encryption.

Another way online bill pay can make payments safer is by reducing the risk of phishing — a type of scam that uses fake emails to trick someone into making a fraudulent payment. If someone has online bill pay set up, they would not be receiving emails requesting payment, since bills are all streamlined through the online account, says Jeremy Bohne, the founder of Paceline Wealth Management in Boston.

Bohne warns that some people might not review their monthly statements when they have online bill pay set up, however. “Most fraudulent charges are easily identified upon reviewing a statement, but if people don’t review their statements, they might not notice and the time window to dispute a charge could pass,” he says.

To avoid the risk of missing suspicious charges, review your statements regularly and set up notifications for when a bill payment is charged.

Bottom line

Online bill pay is a convenient and environmentally friendly alternative to sending checks in the mail. Upcoming payments and payment history are all accessible in one place, making it easier to keep track of what’s due.

Though there’s a concern of overdrawing your account if it doesn’t have enough funds to cover an automatic payment, it can easily be avoided by frequently checking the account balance or signing up for potential overdraft alerts. If you avoid overdrafts and review statements regularly to look out for fraudulent charges, online bill pay can add convenience and security to managing bills.