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The biggest advantage is
reduction in travel to bank to deposit checks. Naturally cash will always have to be deposited physically to bank, but physical items could then be mailed or couriered to bank later for truncation and retention purposes. But for businesses that take in a large volume of checks or have security or staff related concerns, uploading check images directly to bank may have an enticing appeal. A business with capability of imaging and uploading checks will be able to perform their own research, thus avoiding check research fees. It could improve productivity and accounting accuracy. Instead of adding machine tapes or multiple deposit slips listing check after check, images could be quickly scanned and after some simple data entry and reconcilement, images would be uploaded to bank.
Depending on software and hardware investment this could result in significant long term savings for some companies.
Another possible savings are per item fees that some banks charge to process business checks. Most banks allow companies to deposit a certain number of checks each month, but after that, charges accumulate for each item over limit. Electronic exchanges will lift boundaries of how businesses can clear their checks. For example, it would be possible for a business to reduce per item fees by depositing checks with a clearing exchange or even another bank. The clearing exchange or bank could then electronically deposit funds into company's primary business account.
While banks are addressing Check 21 internally, they may not have considered potential that digital check imaging could have for their business account holders. Each bank will have to weigh factors such as; proof of deposit requirements, electronic security, fraud, regulatory requirements, and other issues, in order to accept deposits in this manner.
In reality, most banks have technical infrastructure in place to accept images from business customers. It is just a matter of creating policy and standards to enable businesses to realize cost savings from digital check imaging. But once banks are ready, it will change way businesses handle checks.
Learn more about check imaging at www.CheckCapture.com.
Ken Murphy is a technical consultant for banks and businesses that utilize check imaging technology. He has 16 years of experience in check processing and has been involved in check imaging since 1996.
