Imaging Reaches a Tipping Point

Financial institutions are effectively leveraging the combination of legislation and technology to modernize the way checks are processed.


The larger industry trends indicate that imaging is the way of the future. In a recent American Banker article, the Federal Reserve was quoted as saying they had reached a "tipping point" in September when more check images were accepted for clearing than paper checks. By December, nearly 60% of the Fed's forward presentments were arriving as images. The Electronic Check Clearing House Organization reported that as of November the financial system was handling images at an annualized run rate of 9 billion per year, with volumes expected to peak in early 2009. Three major trends in imaging will change the way checks are processed at various levels of any financial institution.

Branch and Teller Capture Can Reduce A Range of Processing Costs and Reduce Errors
Central Keystone Federal Credit Union ($29.8M in Sunbury, PA) was one of the first to implement a branch capture product in late 2004. Prior to using the product, the daily checks were transported to the local branch of M&T Bank where they were deposited in Mid-Atlantic Corporate's account. Kris Kauffman, President/CEO, recalls the process as being very expensive and inconvenient. Once the credit union began using a scanner to send images of the checks to the corporate credit union, processing costs were cut by more than 50%. Other benefits included receiving next day credit at Mid-Atlantic and receiving notice on returned checks much more quickly.

While branch capture systems are focused on back office operations, the front line can also be a part of imaging trends through teller capture. These systems can also increase processing speeds, reduce teller errors due to fewer keystrokes, and decrease staffing levels or allow representatives to focus on cross-selling.

Growth in ATM Image Capture Systems Expands Convenience
Image-enabled ATMs can help credit unions clear checks faster, reduce fraud and speed payments to members. Processing images enables fewer pick-ups from the ATM, reducing delivery charges. The faster processing time allows credit unions to extend the time period for same-day credit for deposits. Used in branches, these ATMs can allow credit unions to offer an alternative process during times of heavy traffic, such as during paycheck deposit times for local employers.

Image-enabled ATMs are also a viable alternative when considering new retail delivery channels. Their expanded capabilities offer greater convenience than traditional ATMs. Over time, increased familiarity and use will help reduce perceptual barriers towards ATM deposits. These capabilities can also be leveraged to increase confidence and use in shared branching options.

New Remote Deposit Product Offerings Will Impact Awareness and Expectations
In late 2006, USAA Federal Savings Bank was the first major institution to announce an “easy-to-use, secure new service” that allows all members to deposit checks using a common scanner. On the credit union front, Digital FCU ($3.9B in Marlborough, MA) launched their product, PC Deposit, in late January of this year.

Additionally, third parties have begun to actively create and market products designed for financial institutions. Mitek Systems debuted a new software that will capture paper checks and other images through cell phone cameras for members to make deposits. Checkfree, now a subsidiary of Fiserv, also announced in February a remote deposit capture product ready to be used by the financial institution's online banking customers. The only necessary resources are a common scanner, computer and Internet connection – and the check.



March 3, 2008


  • I''m really excited about all the new products that are coming out! I think it''s going to change the way we do our banking! Check out the latest from CO-OP Financial Services ( They seem to be leading the way for credit unions!
  • We have to tip our hats to USAA, the most "member friendly" bank I know of. The more that we do to make it easy for the member and for us the better. This seems like a technology sure to be embraced by younger members. For purposes of the cu deposit, saved trips to a local bank and faster availability are key reasons to make this change.
  • I''ve heard that CO-OP Financial Services just came out with My Deposit which allows credit union members to deposit checks from home on a regular scanner and that CO-OP''s service includes a web-based back office system.
  • Remember full service gas stations? Now we do it ourselves eleminating all kinds of risks. Remote deposit is the wave of the future. The only people that won''t want it are the older folks that wish there were still full services stations!
  • I agree with Rachel''s comment about self service being the wave of the only question why do we need all these branches?
    Dave Frey
  • This is a great new product. Especially for small business accounts. Check out Eascorps remote deposit product. I've heard it's been in use for almost a year now at several credit unions and even works through your existing shared branching connection by way of a partnership with FSCC.
  • Eascorp's product is called DeposZip and it allows our credit union to make online depositing available to members from their home or offices AND business owners can use the very same platform to make their deposits as well. It's very slick and is a whole lot cheaper than sending members to ATMs or shared branches to make deposits