Saturday 25 September 2010

Idea : How to discontinue paper statements

We have all had banks and various utilities trying hard to get us to give up paper statements and opt for e-statements. I, for one, have resisted switching to e-statements. Since its obviously greener, I have been thinking hard as to why I am reluctant, and what will it take to make me switch.

Firstly, having worked with the service delivery side of these organisations for some time, I am deeply suspicious of their motives. To me, its clear that its quite simply a matter of reducing costs, and the "green" benefit is just a way to sell it to customers.

Secondly, I'm not even sure that e-statements are greener than physical statements. There is a certain percentage of the statements that do get printed out (for reconciliation, expense approval or simply archival purposes). These are typically done with less efficient printers & thicker paper. And there is an underlying cost to keeping things in e-form also. Data center costs for one when its stored as attachments to mail in gmail / hotmail / yahoo!mail.

Finally, there are some positive features of paper and e-statements do not seem to fully reproduce the functionality of a paper statement.

I realize now that this sounds like a design brief ... Anyway, some ideas to solve this :

1. Give people a Rs. 50 credit with no strings attached, and then ask them to switch to e-statements - see Influence by Cialdiani for the reason.. Done well, this will have a pretty high take up. It would be seen as a pretty honest way to get a switch made. A less scary way would be offer say Rs. 100 to make the switch.
2. Focus on reproducing the full functionality of paper statements. There needs to be clear archiving & retrieval, for at least 8 years for IT purposes. It should be easy to import it into software or services like so that they can be reconciled against deposits / expenses. An annual or more frequent statement should be sent. You can ask for a paper statement to be sent if you require it.

One further benefit is that eStatements can have greater functionality than paper statements. Some thought needs to go into doing this sensibly. For instance, can the pdf format support sorting or grouping so that certain categories of expenses can be looked at in isolation ? Links to SMS alerts, or e-payments can be promoted in this format. 

Maybe there are various alternative formats available such as PDF, Excel, etc. Or they can be accessed encapsulated in  Apps on the iPhone or even Windows (which can give a lot of incremental functionality that a simple statement cannot).

A well thought through strategy on this will make a lot of customers happy, will make a lot of banks and utilities a bit more efficient, and hopefully will make the planet greener. Until then, I'll stick with paper statements, thank you.


  1. I resist e-statements for another reason. Apart from the organisation claiming brownie points on the green front, the only saving is in terms of getting the consumer to do the printing at their expense.And you do need to print it to share with your accountant.And that's where the whole user experience of this model breaks down.Because all these entities have taken it upon themselves to encrypt the pdf files they send you. To open each statement from each bank, demat account, IT return, what have you, you need a different password and user ID, NONE of which have been chosen by you, and usually something like your CRN (what's that) or account number ( do you know your landline account number- especially since it's NOT your telephone number)The worst is yet to come: if you try to do away with password security now that you feel this is sitting in your in-box or on your PC somewhere, you cannot because there is ANOTHER password set by the entity sending you the statement that controls removal of security!So every time you ever want to see your statement again, you have to find the right user ID, right password, and then when you close the file, that's it till the next time, where you do this all over again.Unless you print it out, which kind of defeats the idea of an e-statement anyway.

  2. One workaround is to open the statement and immediately print to PDF ! Maybe there is a business model for that, probably as an add-on to something like <a href="">Perfios</a>.

  3. I just realized that companies spend much more money mailing marketing offers than statements. Look at the difference in the paper quality ! Maybe that should be added to sweeten the deal.

  4. IFFI Goa has proudly stated that they are starting an e-ticketing site. What a waste of ink &amp; paper ! A movie ticket from the INOX counter is much more environmentally friendly than printing out our own tickets.