Bill Me Later (And Thus eBay) Enters Tax Payments Via Link2Gov

In another example of tax payments going electronic, processor Metavante Corp.'s Link2Gov subsidiary has added Bill Me Later as an option that consumers and businesses can use to pay federal taxes. Assuming all goes as planned, the deal announced on Tuesday should bring more transaction volume to Metavante, the payment processor and owner of the NYCE EFT network, and loan volume to Bill Me Later, the fast-growing online transactional credit provider that eBay Inc. bought last year and placed under the wing of its payments subsidiary, PayPal. “It gives us a much broader audience,” says Frank D'Angelo, group president of Metavante Payment Solutions, which includes Link2Gov. The deal gives Bill Me Later, and by extension eBay, entrée to the huge and potentially lucrative tax-payment market. Link2Gov already enables federal, state, and local tax payments either through direct links to the government entities or through its partner merchant acquirers. D'Angelo says those partners include virtually all of the nation's major acquirers. Link2Gov's federal Bill Me Later service already is live through a Web site, bml.pay1040.com The site walks the taxpayer through a relatively simple process that includes entering a Social Security number, birth date, name, and address. Taxpayers are charged 2.49% of the payment amount as a convenience fee. D'Angelo says Metavante approached Bill Me Later about linking their services as a way to offer taxpayers more payment options?and to generate new revenues. “Obviously we have an ulterior motive?to get more transactions on the system,” he says. Metavante doesn't disclose transaction volumes on Link2Gov, a specialty company founded in 1995 that became an Internal Revenue Service-authorized payment provider in 2003. Metavante bought the company in 2005. A spokesperson for Bill Me Later was unavailable Tuesday. The firm was one of the fastest-growing alternative payment systems on the Web when eBay bought it last November for $820 million in cash and another $125 million in options (Digital Transactions News, Oct. 6, 2008). Bill Me Later's transactional credit system makes transaction-by-transaction decisions on whether to grant the customer credit rather than giving the borrower a revolving credit line as a typical credit card issuer does. Metavante plans to enable tax payments by Bill Me Later customers to state, county, and municipal governments at an unspecified date. Link2Gov allows consumers to charge tax payments online to major-brand credit and signature-debit cards as well as to NYCE, Star, and Pulse PIN debit cards. Transactions on those latter three brands do not use a PIN, however. In related news as the April 15 federal income tax filing deadline approaches, Tier Technologies Inc.'s tax-payment processing subsidiary Official Payments Corp. is doing promotions with MasterCard Inc., Visa Inc., and accounting-software vendor Intuit Inc. this year. Users of Intuit's TurboTax tax-preparation applications can get discounts on TurboTax programs when ordering through Official Payments and paying with a MasterCard or Visa.