VISTA, Calif. — Corporate credit unions' problems are expected to drive greater demand for in-house item processing in the remainder of 2009.
Bluepoint Solutions CEO Hal Tilbury made that prediction and expects his company's Check 21 services will benefit, as a result.
"Everyone knows there's speculation that the 27 corporate credit unions will wind up being only three or four in total," Tilbury said. "That is causing many natural-person credit unions to think their corporate may not be there in the future to handle their item processing."
Tilbury said that credit unions are contacting Bluepoint daily and saying they are considering going in-house with item processing. "Now that might seem counter-intuitive," observed Tilbury. "With check volumes going down you think credit unions would not be thinking about going in-house and would be turning to third parties. That's not what's happening. It's the FUD factor-fear, uncertainty, and doubt. Credit unions have relied heavily on corporates for years for item processing. But if that goes away, they are saying they have to take the bull by horns and go in-house."
Tilbury said Bluepoint's new remote deposit capture product is gaining a great deal of interest from credit unions, not only due to the corporate troubles, but from the growing demand to go paperless. "As we all know the Federal Reserve has cut back and will continue to cut back on its number of item processing centers that allow you to submit paper. I think at the end of year we will only have one federal item processing center accepting paper."
Tilbury predicts that the recession will not end "anytime soon," adding that Bluepoint has been working with CUs whose budgets may have been restricted by the economy and the corporate assessment. "We offer a rental program that lets credit unions get into Check 21 without a capital expense. We will rent the software, equipment, and relationship service for a flat monthly fee, either on a per-branch or per-teller basis."
