Remote Deposit Capture Delivery Lags Customer Demand

by Trent Flemming, friend of TriNovus

For more than five years now, Remote Deposit Capture (RDC) technology has been widely available. Early efforts at deployment tended to focus on those customers who, by virtue of their distance from a branch, or the nature of their business, would seem to benefit most. Often, it was these customers, along with those who simply saw it as a “must have” technology, where banks focused their initial efforts. In some cases, banks acquired an RDC system to meet the needs of a single customer. As with most new technologies, the actual end users tend to teach us what the real value of the solution is, as they interact with it day to day. In the case of RDC, two things immediately became clear. First, the time and distance benefit was real: customers could avoid trips to the bank for deposit purposes. The second benefit was less intuitive though. The process of preparing the deposit electronically was superior to preparing a paper deposit. This was true for THREE reasons: 1) manual efforts to list large numbers of checks were eliminated, 2) accuracy and integrity of the deposits were improved, and 3) access to an electronic history of all deposited items was a tremendous benefit from a research standpoint. Put more simply, once a business began using RDC they were unlikely to give it up.

All of the benefits do not accrue to the customer, however. Banks can benefit through significantly reduced branch traffic, more accurate deposits, which are electronic in nature and require little handling, and include complete information allowing intelligent routing and immediate posting of on-us items.

Surprisingly, though, most banks have failed to to deploy RDC in a significant way. Customers embrace and rapidly adopt the technology when it is made available to them, but banks are generally failing to properly educate their employees and and promote the service to their customers who may benefit from it. RDC is an easy sell when employees are well trained regarding the benefits of the solution, and in how to anticipate and overcome potential objections.

An emerging threat to many bank's important business customer relationships are third parties who are selling RDC services directly to merchants, other commercial businesses, even churches. Using a sponsoring, clearing bank, these ISOs begin to take control of the customer relationship from the primary bank, by gaining the deposit business. Over time, the sponsoring clearing bank will no doubt attempt to take the deposit accounts away from those banks, as well. The quickest way to end this threat is to be sure that you are promoting a robust RDC offering to your business customers.

Trent Fleming (www.trentfleming.com, trent@trentfleming.com ) is a consultant who works with banks to address a variety of operational, technology, and regulatory issues. He has worked extensively with RDC systems, and is able to guide banks in successfully rolling out such programs to benefit the bank and its customers.