According to the 2007 Federal Reserve Payments Study, check volumes overall are declining at more than four percent each year. As a result, the costs associated with clearing checks through traditional channels continue to rise to offset the decline in volume.
Banks are faced with the rising costs of check processing in every channel, including the vault.
Garda proposed immediate solutions following the enactment of the Check Clearing for the 21st Century Act, “Check 21,” to leverage remote image capture and implemented a full suite of electronic, image-based vault services in its Transaction Centers.
“With the advent of Check 21, we realized we could offer our clients a cost-effective solution to help expand their footprints and reduce costs,” said Patricia Marr, Garda Vice President of Product Management. “By expanding our existing vault services to include image-based cash logistic services, our clients can effectively capture and exchange images received through Garda’s Transaction Centers network, significantly accelerating deposit capture, posting and presentment. Vaults can now be accessed electronically.
“We are now able to offer customized programming and multiple file layouts to satisfy specific bank requirements,” added Ms. Marr. “This is very important to our clients and sets us apart from the competition.”
Garda’s virtual Transaction Centers now have the capability to immediately scan, process and balance mixed deposits of both cash and check documents. Garda has the ability to process checks, capture images of paper tickets used to issue credit for cash deposits or cash adjustments, and provide direct billing data to banks.
Garda’s image-based virtual Transaction Centers solution enables financial institutions to increase funds availability, expand geographically and more accurately manage deposits – all without needing additional resources. Specifically, this service helps banks attract and better serve commercial customers.
“We have developed a proven image-based Transaction Centers service offering,” said Ms. Marr. “We offer our clients a complete range of image-based item processing resources and expertise. We are now able to anticipate and meet the evolving cash management needs of financial institutions.”
Focus on Deposits and Customer Service
One of the more significant cost savers is in reduction of float and the availability of funds.
Check and deposit items are electronically scanned, processed and transmitted from Garda’s secure Transaction Centers facilities, guaranteeing improved funds availability and reduced processing fees. Banks that are able to collect both cash and checks from large commercial customers and provide faster credit and funds availability are providing an invaluable and unique service offering. Banks using Garda’s virtual vaults have the capability to collect checks late in the day and have them captured, processed and available that same evening. In a traditional vault setting, there would have been at least a 24-48-hour delay in funds availability. Banks offering this service to commercial customers immediately gain a competitive advantage in the market.
Accurate Deposits and Balancing
Garda’s centralized deposit balancing process captures, truncates, balances and adjusts check deposits for each of its bank customers. Check images are then formatted as X9.37 files for posting or bank-to-bank image exchange. Within the Transaction Centers checks are scanned and the images are sent to a centralized server where items are repaired if needed and then immediately balanced. The consolidation of the check processing in an ASP environment enables highly trained personnel to manage this functionality – allowing the banks’ vaults to stay in balance.
“We have created a distinct competitive advantage,” continued Ms. Marr. “We’ve been able to grow existing client relationships by enabling them to reach new markets, and we’ve attracted new clients who are also interested in expanding their reach, but need to either maintain or reduce costs. In challenging times, this is extremely important – we are able to help our clients expand and grow, without incurring costs.”