Online Bill Pay Explained for Canadians (And Why to Use It)

Paying a bill in Canada used to mean mailing in a cheque or dropping off cash in person. But that’s no longer the case. Today, modern technology allows for a different process. One that doesn’t even require logging onto multiple websites. It’s a simple, centralized solution through online bill pay.

Instead of organizing multiple due dates or dealing with an array of account websites, paying bills through your online banking is simple. This method lets you manage these payments through your bank’s mobile app or website platform. The streamlined process allows for more control over timing and fewer missed payments. It also provides you with a clear record of the transactions.

What is online bill pay?

Online bill pay lets you put money towards your bills directly from your bank account. There is no need to go into the bank branch in person. Instead, you can facilitate the transaction online through the straightforward bill pay process.

Here’s how to use online bill pay, step-by-step:

1. Log in to your mobile or online banking
2. Click “Pay Bills” then “Add Payee”
3. Select the payee from your bank’s list of registered billers
4. Enter your account or reference number with the receiving company
5. Set the payment amount
6. Choose the payment date

In Canada, you can use bill pay through the mobile apps and desktop platforms of the banks and credit unions.

What bills can you pay online in Canada?

Online bill pay covers many of the major expenses Canadians deal with each month. Through your online banking or mobile banking app, you can typically pay the following:

• Utilities, including your hydro, natural gas, and water bills
• Cell phone and internet service
• Your credit card bill for cards issued by major Canadian banks and card providers
• Property taxes (in select municipalities)
• Income taxes, instalments, and other government payments to the Canada Revenue Agency (CRA)
• Tuition and student loans
• Insurance premiums for auto, home or life insurance

Why Canadians use online bill pay

In Canada, online bill pay is popular because it simplifies how money moves to the payee without needing to give up control. Instead of juggling multiple logins across different websites, online bill pay consolidates payments into one place. The setup makes it easier to manage due dates, in turn avoiding late fees while still keeping an eye on your account balance. For example, you can align your bill payments with your paycheque date. It also allows you to initiate the payment so there are no surprise withdrawals potentially leading to overdraft fees.

Another benefit of online bill pay in Canada is that your bank will keep a clear transaction record of each payment. This makes it easier for you to track your spending or confirm that a bill was, in fact, paid. Ultimately, the service helps Canadians stay organized and manage their accounts efficiently.

Online bill pay vs autopay: What’s the difference?

While they seem similar, online bill pay and autopay are not the same thing. Autopay, also known as a pre-authorized debit, occurs when a company pulls money from your bank account automatically. This differs from online bill pay where you set up the payment on your end, selecting the amount and date for the transaction to occur. There is a trade-off here. Online bill pay suits those who want control without giving up convenience, while autopay releases you from the requirement to make the payment yourself. But the convenience comes at the cost of control. Either option can work to settle your bill, it’s just the logistics that are different.

Is online bill pay safe in Canada?

Online bill pay has the same security system standards that the rest of your online banking does. Canadian banks and credit unions have multiple layers of protection including secure logins, encryption, and ongoing transaction monitoring. The system helps keep both your information and payments safe.

That said, security still depends, in part, on how you use the account. Reduce your risk of fraud by using a strong password, updating your banking app as needed, and monitoring your bank account on a regular basis.

For added safety, always check the confirmation screen after you press “submit” on a bill payment. Review your transaction history afterwards to ensure everything looks correct. If it doesn’t, then you can contact your bank directly for assistance.

Online bill pay mistakes to avoid

While online bill pay is convenient, there are still a few common issues to watch out for:

• Paying too close to the due date. Remember, bill payments don’t process instantly. When you make a last minute bill payment, processing delays can lead to late fees or, even, service interruptions.
• Entering incorrect account information or reference numbers. A single typo can send your payment to the wrong place. It can take time for the bank to amend the error, if they can fix it at all.
• Assuming same-day delivery. Online bill pay doesn’t work like an e-Transfer. It’s not automatic. Instead, most billers need time to receive and post the payment to your account.
• Forgetting to update your payee list. If you move, switch service providers, or change account numbers, you need to update your payee list. Outdated information can cause payments to fail or post incorrectly.

Tip: How long an online bill payment takes depends on the biller. According to the Royal Bank of Canada (RBC), “the payee may take 3 to 5 business days to post the payment to your account.” Avoid timing errors by sending your bill payments a few days before the due date.

Takeaway

Online bill pay gives Canadians a simple way to manage recurring expenses without giving up control over timing or their cash flow. By centralizing payments through your online banking, you can reduce the risk of missing due dates or getting hit with a surprise withdrawal. Use the system to schedule payments in advance, double-check account details, and monitor the confirmations to manage your bills more effectively.