PASS THE IMAGE, PLEASE.
by Keith Taylor
There used to be a common phrase that went something like, "Pass the check, please." The developments in the financial industry and the legislation being considered in Congress could well change this language to, "Pass the image, please."
Checks still have volume
Just look at the numbers. Check writing in the U.S. continues to grow, despite those who project the demise of checks to the debit card. More than 49.6 billion checks are still written annually in the U.S, with $47.7 trillion in check payments processed each year. Unlike any other country in the world, checks written in the U.S. account for nearly 60 percent of all non-cash payments.
Where to capture?
FI's are helping to drive the CTA by recognizing the inherent efficiencies in capturing a check image as early as possible in the processing cycle. Truncation has already begun. Louise Roseman, Director of the Division of Reserve Bank Operations and Payment Systems at the Federal Reserve Board, recently addressed an audience of more than 100 leading U.S. financial institution representatives at a seminar sponsored by NCR and the Electronic Funds Transfer Association (EFTA). According to Roseman, requests by FIs and retailers to capture images helped lead to the drafting of the legislation.
I'll take that check
There are several viable capture scenarios: distributed cap-ture at the ATM, bank branch or retail store back office; capture at a commercial customer's site or anywhere it improves the ability to serve customers. Checks can also be sent to a central location, as often the choice by high-volume process-ing operations.
Quality is paramount
The bottom line to any image capture and truncation scenario,and all potentialities surrounding the proposed Check Truncation Act, is that of image quality. In its current draft form, the CTA states that if the quality of the scanned image or substitute paper check does not meet Fed requirements or is in any way debatable, the institution that first provided the substitute check will be liable. So, quality is, indeed, paramount.
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