Remote-deposit capture: a benchmark for banking's future technologies.

• Author: Nerland, Brian

Banking, as we know it, has changed; and gone are the days of frequent trips to your local branch. Today, banking is giving business owners what they need most ... more time. More time to spend with customers. More time to focus on products and growth strategies. But how is banking providing more time for large and small businesses alike? Through innovation in services and technology designed to enhance efficiency and effectiveness.

THE FOUNDATION

Signed into law in October 2003 and enacted a year later, Check 21 set the foundation for the innovations that were brought to market. While Check 21 did not mandate that banks image-enable processing operations or exchange images with other banks, it instead opened the door to embracing this technology.

Check 21 allowed for the creation of substitute checks, which are the legal equivalent of paper checks. Substitute checks are created by printing electronic images of the original paper checks. By creating substitute checks, banks are able to remove paper checks from the collection and return processes. As such, Check 21 legislation is a marketplace enabler for innovations that result in efficiency and savings to clients.

TODAY'S TECHNOLOGY--REMOTE-DEPOSIT CAPTURE

Remote-deposit capture, which some consider to be one of the most significant banking innovations in decades, is a direct result of Check 21 legislation. Having taken the market by storm, remote-deposit capture allows businesses to utilize desktop scanning devices and software to capture images of checks at either an office or store location. Checks are then deposited by transmitting images to a bank instead of physically delivering the original paper items.

According to the American Bankers Association, 16 percent of banks currently offer its clients remote-deposit capture. In 2007, 33 percent of banks plan to add remote-deposit capture to its list of product offerings, and 9 percent plan to add this technology in either 2008 or later. It is evident that remote-deposit capture is a growing trend.

Additionally, more and more businesses have adopted remote-deposit capture because of its benefits. One of the major benefits of this technology is that it allows companies to make deposits into one single account at one bank, instead of into multiple accounts at multiple banks. Essentially, remote-deposit capture takes geography out of the equation when an organization selects a bank for check depository services. A company that uses remote...