PASADENA, Calif. – Wescom Credit Union has made a lot of money from its membership by not charging them a thing . for billpay. Wescom launched its BillPayer service with a $4.95 monthly fee in February 2000. Now, it has begun offering the service free to its 200,000-plus members after an internal study proved the extra profitability of patrons of electronic payments. According to Vice President of Marketing and Commerce Brian Siegel, what the $2.4 billion CU wanted to know was this: "Do members become more profitable because they sign up for BillPayer, or are they using it because they are already the credit union's best members?" So the CU studied two groups of 150 members, a control group and another who enrolled in BillPayer in January 2002. They were of roughly equal profitability until electronic bill paying began, when the BillPayer group became on average more than $400 more profitable per household. Why? "BillPayer users have an average of 3.55 services per household, not including eBranch or BillPayer, compared to 2.17 services for our general membership," Siegel says. Those results followed those of a large bank that had eliminated its electronic billpaying fee and saw adoption increase by a third and deposit growth and loan growth among those customers by even more than that, Siegel says. Assessing that experience, coupled with the internal study, made it clear to Wescom leaders that the CU would easily make up in increased business what it would lose in fee income by removing the cost barrier to signing up for BillPayer. The fee was dropped in June and more than 4,000 members quickly joined the ranks of new users. "Prior to launching free BillPayer," Siegel says, "we were projecting annual growth of about 30%. Given the results we've seen so far with free BillPayer, we're anticipating that growth rate to double to more than 60% this year." [email protected]