Australia | May 31 2007
By Greg Peel
They all laughed, noted Bill Express (BXP) CEO Bill Christiansen, when it was suggested that someone would pay a 40% premium over contracted customer prices to make mobile phone calls using a pre-paid account. But they’re not laughing now, and even the most enthusiastic of supporters has been staggered as to just how successful the pre-paid phone card has been. Over 8 million Australian consumers have used them for starters.
We now live in a society where a bank account is essential and a credit card is almost mandatory in order to be a general consumer of goods and services. Certainly, without either life becomes more difficult. But while a bank account is only beyond the realms of the least wealthy in this world, a credit card is not quite so easily attained if sufficient criteria are not met. And a credit card is also a dangerous temptation for many.
The need to carry around large sums of cash has been alleviated by EFTPOS and/or credit card facilities in everything from restaurants to supermarkets. The need to possess a credit card has also been alleviated by the availability of “debit” cards which act in the same fashion but can only draw on existing bank account funds. But there has to date been one missing piece in the complete puzzle. Enter bopo.
A bopo pre-paid Visa card allows you to transfer a small amount of money on to what then becomes effectively a credit card with a small limit. A cardholder can load up by handing over cash at a newsagent, just like a phone card, or by simply sending an SMS message that transfers money from a bank account or standard credit card. The card can then be used anywhere Visa is accepted – in a shop, in an ATM or over the internet – anywhere in the world.
The advantages of bopo are readily obvious to those without, for some reason, a bank account, or without sufficient credit status to be granted a credit card. Bopo would also be an advantage for children, students and travellers. For those on any socio-economic scale, there are advantages in not having to carry either cash or even an EFTPOS or credit card other than a bopo card in one’s wallet. When shopping on the net, security issues are overcome with bopo. Bank accounts cannot be raided if bopo card details fall into the wrong hands, unlike an EFTPOS card.
Bopo is what Bill Express’s Christiansen is particularly excited about. Bill Express is a listed microcap operating electronic production distribution, payments processing and in-store promotional media businesses. Retail applications include vending of pre-paid products and services (such as phone cards), reward systems, provision of bill-payment and EFTPOS facilities and the sale of in-store advertising screens.
The advertising screens are another growth area the company is keen on. If you’ve had the misfortune recently of actually having to physically walk into a bank and queue up you might have noticed a screen running promotional videos about the latest home insurance and funds management products available. Yes – very annoying I know but this is one area of the advertising market that is as yet largely untapped and has an upside such as that of website pop-ups. Imagine screens in every store featuring promotions, in-house specials, and any other form of advertising information. Imagine screens just about anywhere. That’s the aim of Bill Express’s PodTV.
Bill Express achieved 100% profit growth in 2004, 31% in 2005 and 13% in 2006. The 2006 result of $6.3m was “dampened” by a big hit in depreciation and amortisation. Over the year the company acquired 50% of PodTV to take its ownership to 100%, acquired Ezipin, a prepaid services competitor (increasing outlets and prepaid turnover by 30%), increased the number of bill payment billers to 380, and products to over 300, and increased the number of product vendors to 14,300. And it developed and released bopo. Bill Express anticipates revenues will break $1 billion this fiscal year.
It is also planned that the next step in the bopo revolution will be the addition of a smart chip, which will facilitate, for example, buying a beer at a pub by waving your card in front of a sensor. The cashless society we’ve so long been told to expect is almost upon us, and Bill Express intends to be very much a part of it.
The company is to our knowledge not covered by any expert in the Australian market, hence there are no forecasts or recommendations to quote.