LOS ANGELES -
"Remote deposit is getting more attention in the last couple of years because credit unions are looking to differentiate themselves and offer increased convenience for members," explained George Kings, vice president, information services at the $790-million Los Angeles Firemen's CU (LAFCU).
The tool, called CUDeposits, was "built for our own needs but is flexible enough to be sold to other credit unions," Kings said. LAFCU developed the solution in partnership with Livermore, Calif.-based CUBUS Solutions, a CU technology provider.
CUDeposits goes live next month at LAFCU and allows members to log-in to Internet banking, instantly qualify for the service, enter check information and have immediate access to a deposit advance-all before putting the check in the mail, Kings said.
Credit Union Journal reported in 2001 that Harrisburg, Penn.-based Pennsylvania State Employees CU would offer UPost personal remote deposits at its website, becoming the first CU to credit the member's account online before the actual check is mailed and posted.
"Out in the credit union marketplace there's UPost, but it would be great for credit unions to have a second choice in their due-diligence process," Kings added.
Unlike UPost, CUDeposits also allows members to call checks into a CU's contact center, according to John-Ashley Paul, president, CUBUS Solutions.
Remote deposits are gaining steam across the industry: about half of the nation's banks plan to allow personal or business accounts to deposit checks over the Web by next year, according to various researchers.
LAFCU expects 20% of deposits from all other channels, including branch, shared branch and ATM, to start funneling through CUDeposits within one year, Kings said.
"We're looking to ramp up volume pretty high and therefore reduce some of the expense with other channels," he said.
As a result, the service will save LAFCU about $50,000 in interchange fees the first year, he said.
"I also have to believe that there would be an additional 15% increase in CUDeposits overall because of the convenience," Kings continued.
With the advance limit set at a running total of $5,000 and the service open to all eligible new and existing members, "we've left the rules pretty wide open," Kings said. "We're in a situation where it's prudent to take on more risk, but other credit unions could easily build in different rules."
CUDeposits is interfaced in real-time with the Harland Financial Solutions Ultradata core system but can interface with other core systems as well, said Kings. The interface gives LAFCU "a lot of flexibility with how transactions are processed, for example, we can immediately post an advance to the member's account."
LAFCU passed on the UPost product and other solutions in favor of "building a product that suited our needs," Kings said. Not only does CUDeposits allow for a "very high" running total of $5,000, but it can also automatically place better terms on checks from preferred payers.
CUDeposits isn't intended for high-volume personal or business deposit accounts that would benefit from special software or check-capture devices, said Kings.
"CUDeposits addresses the masses," he said. "For the average member making one or two check deposits per week and for lower-volume small businesses, it's perfect."
A three-year license for software and interfacing ranges from $25,000 for CUs up to about $200-million in assets, to $80,000 for credit unions $1-billion and larger, Paul added.
more
Read more about remote deposit for personal banking and Check 21 at cujournal.com and search the following bolded terms in the archive:
PSECU's UpostHome Program Garners Accolades At Tech Meeting, for more on how the UPost product works.
Instant Online Activation Latest Feature At PSECU, for Credit Union Journal's breaking coverage of PSECU's UPost product in 2001.
Will Check 21 Technology Go The Way Of Betamax?, for a story about credit unions taking a cautionary approach to adopting remote deposit technologies.
* LAFCU, www.lafcu.org
* CUBUS Solutions, www.cubussolutions.com
