The Bank of Nova Scotia (BNS) and National Commercial Bank (NCB) recently introduced the option of bill payment via the Internet possibly to keep abreast of global technological trends and to give customers the opportunity to carry out transactions instantly and easily.

With online bill payment customers are able to make payments to a number of merchants including utility companies, cable providers, Internet service providers, mortgage institutions, and credit card companies. With NCB's online banking system customers are able to search through specific categories for the merchant of their choice. Most utility companies accept payments via online banking. If you are not sure whether the merchant of your choice accepts payments through this medium, give them a call to find out.

Setting up your accounts to be paid is easy. Simply select the name of the business from the list of merchants provided on your bank's Web site. Access to the online bill payment option is only possible however, if you're a registered user of your bank's Internet banking system. Once registered, customers must enter the account number printed on their bills and the amount to be paid to carry out the transaction. Payment can be credited from their savings, chequing, or current accounts to pay bills.

How do you know that your payment has been received by the bank for processing?

For BNS, after you enter the bills to be paid, hit the "preview" button on the Bill Pay screen and a confirmation window will appear for you to approve the total amount of bills to be paid.

Once you click on the "submit" button, a confirmation number will appear to validate your transaction. Keep this confirmation number for your records. An additional way to confirm transactions is to view your account history the next business day to see the payment posted to your account. If it is not there, click on the Transactions Tab and verify your account history. If the transaction still does not appear, calling the bank's Internet banking section is the next best bet.

How long does it take before the merchant receives payment?

Once you submit your bill payment via Scotiabank Internet Banking, the money will be debited from your account at the time that you submit it for processing. Depending on the bill payment company's processing policies, the payment may take up to four days to process.

With NCB, merchants can receive payments within hours of the bill payment.

Your creditors receive your online payment in one of two ways: electronic payment or cheque. If the payee is set up to accept electronic payments, your payment is automatically debited from the account you select and deposited electronically into their account, just as if you had written a cheque.

If the payee cannot accept electronic payments, and most businesses cannot, they will be issued a cheque based on your online payment instructions; hence some banks' four to five-day grace period.

Both banks allow customers to make scheduled bill payments online. According to the BNS, once you have registered the accounts you wish to pay online, the next step is to schedule payment. You simply select the account you wish to pay from, the payee account you wish to pay to, the amount you wish to pay and the date you want the payee to receive the payment.

If you are thinking about taking advantage of your bank's online bill payment service, bankrate.com recommends asking yourself the following questions:

How many bills do you pay each month?

Is the paperwork a monthly nightmare?

If your accounts are spread across several institutions, or you write just a few cheques a month, it may not pay to do your banking online. If you frequently use the automated teller machine to withdraw cash or transfer balances among your accounts, you should probably use a local bank. Otherwise, you'll be forced to pay heavy fees if you use another bank's ATM. But if you have multiple accounts at one bank, a torrent of monthly bills and little free time, online banking may be an option.

What fees do I need to be aware of before signing up?

It depends. For now, both NCB and BNS provide online bill payment for no charge. NCB customers who have not signed the bank's Midas Plus agreement will be charged $6.50 per transaction.

How do I qualify for online bill payment?

You'll typically need a chequing account established with the financial institution first. Once the online application is sent to the bank, within five business days (or in some instances the same day) you will be able to bank online.

Will I need to use software to set up my accounts?

No. However the basic system requirements listed below are necessary:

Computer equipped with at least a 36.6K modem

A screen resolution of at least 1024 x 768 pixels

Internet access through an Internet service provider (ISP)

Internet browser: Microsoft Internet Explorer 5.01, 5.5 or later versions or Netscape 4.73 or later versions.

What if I have a dispute about a bill payment?

According to NCB, if an unauthorised payment is made the customer will be held liable for the amount since passwords are used to ensure optimum levels of security and it is the responsibility of the customer to keep that information confidential. For incorrect payment amounts and overpaid amounts in particular, the additional amount will go toward the next month's bill as per the policy of most utility companies.

What do I do if I need If I need to talk to a real person?

Both banks have toll free numbers to contact customer service representatives to answer even the simplest customer queries. NCB's customer service line is open 24-hours a day.

How do I discontinue the service if I'm not satisfied with it?

Notify your bank to deactivate your online service. It typically takes up to 10 business days to stop the service.

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