COCC, whose Avon headquarters are pictured above, believes many banks would benefit from moving to check imaging.
While moving to check imaging is something many Connecticut banks are talking about, some are still skeptical about any potential savings. But Avon-based COCC says it has figured out once and for all that many banks would benefit from moving to imaging.
“[There are] big savings there,” said COCC Document Processing Manager Betsy Didan.
The company last week announced that it plans to introduce end-to-end imaging software in January. The “imaging solution” comes after COCC purchased various software components from AFSImage and reached an agreement to use NCHA, the nation’s largest check settlement organization, and Endpoint Exchange, the national check image exchange, according to a release from the company.
Imaging is possible since the Check Clearing Act for the 21st Century, or Check 21, became law on Oct. 28. The law allows banks to replace original paper checks with substitute checks, which are made from digital copies of the original, according to the American Bankers Association. The law was created to reduce the time, risks and costs that occur with paper check processing.
“Currently, checks travel on trains, planes and automobiles during the clearing process,” according to an ABA release on the subject. “When Check 21 [became] effective, banks will be able to send digital images of checks electronically, eliminating the need to physically transport paper checks between banks.”
That’s where check imaging comes in and, so far, banks have shown “tremendous interest,” Didan said.
“We’ve taken [the process] really end to end,” she said.
A ‘Sizable Investment’
But the component of the package that might sway bankers into using imaging for their banks is the financial spreadsheet, which Didan says can show how much money banks could save if they switched to imaging. Imaging would wipe out courier costs, microfilming and equipment and some processing fees, Didan said.
“Those fees get totally wiped out,” she said.
But banks are still skeptical. There are so many factors to consider when switching to imaging that it is a complicated decision, said Brent Digiorgio of Bridgeport-based People’s Bank.
“We’re evaluating the possibilities now,” he said.
It is also an expensive process, and People’s officials want to make sure that whatever they decide will fit with the bank’s future and will be worth the money. The bank has no immediate plans to shift to imaging, Digiorgio said.
Sue Murphy of Middletown-based Liberty Bank agreed.
“It takes a pretty sizable investment,” she said.
But COCC is confident that banks will eventually move to imaging because the country’s larger banks are going that way, so imaging is becoming the standard of service. COCC is piloting the imaging package in a community bank. Didan said she couldn’t release the bank’s name, but did say it is a community bank with assets in the mid-$100 million range and more than 12 branches.
“It’s a great model,” she said.
The company hopes the all-in-one package will also spur banks to move to imaging.
“With today’s agreements [with AFSImage, Endpoint Exchange and NCHA], COCC is prepared to offer a complete, end-to-end check image processing solution,” said COCC Chief Technology Officer Joseph Lockwood in a prepared statement. “Our advanced technology and thorough preparation will deliver the full benefits of end-to-end image processing to our check processing clients.”
“Many more components are required for true end-to-end image processing than most vendors or financial institutions realize,” Lockwood added. “That’s because each vendor sells its own piece of the overall image process; the institutions are left to assemble a complete end-to-end solution.”
