Businesses can now deposit checks directly from the office
by Cape Business staffBanks of all sizes are investing in image-capture technology. Using a desktop scanner, you can deposit checks directly from your office into your bank account. Technology now allows you to scan the check and electronically transmit the image to the bank, where it is processed for rapid clearing.
“No longer are companies reliant upon brick and mortar [facilities] to do banking, nor do they need to be constrained waiting for their bank to deliver time-sensitive information,” said Marshall Soura, executive vice president for Sovereign Bank.
It also means you can deposit checks at 2 a.m. – effectively, 24-hour-a-day commercial banking.
It is estimated that an average business might spend between $200 and $500 a month in time and manpower just physically depositing checks with a bank. Not only will this technology save companies time traveling to and from the bank, but the electronic transmissions expedite the availability of deposits by as much as two days.
According to Celent Communications, banks that are launching remote capture now will win customers away from those who are not, and, over the next year, between $150 million to $200 million in commercial deposits will migrate to banks offering remote capture.
The new technology levels the playing field for banks in two ways: It gives community banks a way to attract commercial customers who otherwise might be beyond their geographic footprint. But it also means that larger banks will be able to attract businesses that no longer care how close they are to a particular branch.
Nationwide, the insurance industry is among the early adopters of remote capture, saving larger companies with disparate brokers time and money. Agents at branch offices will be able to deposit checks into a single depository account, eliminating the need for daily trips to local bank branches. Electronic transmission also leads to faster settlement, and allows insurers and agents to find out sooner if a check is fraudulent or written on a closed account.
Rockland Trust and Sovereign were among the first in this market to offer merchant check capture service. Now, every bank is rushing to test the technology and offer it to their customers – either through equipment sales or leasing.
Interviews by Plymouth County Business indicate that most banks will be offering the service by the end of 2007 after they select vendors and integrate the technology into their systems after assuring for quality control and security issues.
“I felt it was necessary to do,” said Tracey Scalata, senior vice president and cash management director of Rockland Trust, which had more than 40 users in place before the end of 2006. She told Banker and Tradesman magazine that six of 10 users actually were located close to a branch, but still chose remote deposit.
“This is going to be the wave of the future,” she said. “To grow deposits, you really have to stay on top of technology.”
David Floreen, senior vice president for the Massachusetts Bankers Association, said, “The value really comes first and foremost in simplifying life for your existing companies. It really is a customer benefit, and banks will be flocking to those types of services. Banks have a lot of pressure [to attract and retain customers]. It’s a very competitive marketplace, and companies have lots of choices as to where they do business.”
For businesses considering this technology, consider:
• The equipment, which usually comes from third-party providers, costs between $1,500 to $1,800. Some banks are considering ways to help their clients lease the technology.
• Funds deposited remotely should be available more quickly than if a check was brought in and deposited at a branch office. This can help your business, but check issuers must realize they have to have funds in their checking account to cover payments.
The sudden emergence of remote deposit coincides with more and more people using debit cards and credit cards to pay their bills. Yet, about 80 percent of business-to-business transactions still involve payment by check.
Even if the number of clients ready for remote checking is limited, most banks interviewed by Plymouth County Business believe it is a necessary service to attract new customers overall. It suggests a full-service, technology-driven banking partner.
Systems vary, but here is some general information on adopting remote deposit. Call your bank for more details:
• Your business will need Internet connection, a Web browser and a reader/scanner. You should be able to operate with Windows 98 or higher, especially Window 2000 or XP. The browser should be Internet Explorer 6.0 or higher.
• These are among the leading providers of remote capture technology – you can learn more about them online: Alogent Corp., BankServ, Carreker Corp., Goldleaf Financial Systems, NetDeposit, Metavante Image Solutions, Open Solutions, ProfitStars, RDM Corp., Vicor and Wausau.
Published in Cape Business May/June 2007
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