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Online Bill Pay started out as a fee-based service for most banks because of what I said above: it doesn't make any money for banks and particularly in the early years would have been predominantly print-and-mail based which is, in aggregate, hugely expensive (a large bank is processing a couple million payments a day). But competitive pressure combined with the fact that the fees on bad money people (who generally have low balances and aren't otherwise of great value to banks) to make "sticky" features more valuable than the simple math indicated.
GD: There is no specific flat fee that I am party to being discussed so I couldn't say. It truly is hypothetical on my part (really, I'm trying to think through proposals for an area that isn't my product; whatever I say would likely be shot down immediately as something they already have worked through). That said, as with all flat fee services it would depend on how much you use it. There are people who use bill pay and generate one paper payment a month. Any monthly fee above $0.44 would be more expensive. There are other people who generate dozens (and even hundreds) of such payments a month. Any realistic flat fee would be a savings for them. But I'd guess a flat fee would be, for the vast majority of people, more expensive than pay-as-you-go.
But that was kind of the reason I wanted to ask the question. Interested to know, if like ISP data plans, pay-as-you-go is anathema to most people despite the fact that for most people it would be cheaper.
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