Newsagents and small telcos hit by Bill Express collapse

The collapse of electronic payments company Bill Express has left around 3500 newsagents and a string of small companies scrambling to set up alternative payment networks.

The collapse of electronic payments company Bill Express has left around 3500 newsagents and a string of small companies scrambling to set up alternative payment networks.

Bill Express was placed into administration yesterday after collapsing with debts of more than $180 million. Big creditors include ANZ, Telstra, Optus and Vodafone.

Yesterday, Bill Express told the 3500 newsagents who have Bill Express terminals in their stores to stop making transactions. The terminals allow newsagents to complete three forms of services; merchant services (where customers can pay for goods sold in the newsagents via debit or credit cards), the sale of pre-paid phone cards and account top-up cards, and bill payments.

ANZ will roll out new terminals to newsagents, allowing them to offer customers card payments services from today. (ANZ does not expect to recover much of the $50 million it is owed by Bill Express, but at least it will get a handy terminal network as a result of the collapse.)

But Mark Fletcher, who owns a newsagency in Victoria and promotes a Bill Express alternative called eziPass, says the ANZ move will only solve one problem for the Bill Express newsagents. “The biggest issue is newsagents selling mobile phone top-ups and electronic vouchers,” he says.

While alternative payment systems do exist, Fletcher says it typically takes a week before the system is working in the store. “These newsagents have got a week’s worth of pain coming up.”

That pain will also extend to phone card suppliers who sold products through Bill Express, such as Telstra, Optus, Vodafone and GoTalk, which owns Australia’s largest phone card distributor CardCall.

The Bill Express collapse could create severe disruption for some of these companies, as it is that some phone card suppliers received 35% to 40% of their revenue from sales through Bill Express.

Finding an alternative over-the-counter bill payments system will also be a problem for newsagents and the huge variety of companies, government organisations, sporting clubs, charities and utilities that offered bill payment services via Bill Express.

Fletcher says the only viable alternative is Australia’s Post’s BillPay system. Another player may want to step into the market and grab Bill Express’s footprint, but Fletcher says this will not be easy. “It’s a challenge thing to get up and running. It’s a low margin business that requires significant infrastructure and up-front capital expenditure.”

At least two groups of newsagents were preparing legal action against Bill Express before its collapse.

Read more on Bill Express and payments systems

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