Bank of Boston Corp. is preparing to roll out a CD-ROM check image system designed to give corporate customers an alternative to receiving the account information on paper or microfilm.
The system, which will be available at the end of the first quarter, uses search and retrieval functions that allow customers access to canceled checks almost instantaneously on their computer screens.
The new service is part of a growing wave of niche products related to check imaging, a technology in which a special camera creates a digitized, computer-storable picture of a paper document.
Corporate cash management departments rank among the most eager deployers of the technology, according to the Tower Group, a consulting firm based in Wellesley, Mass.
The reason for this lies at least partially in customer demand.
"Our customers have expressed a keen interest in the retrieval speed and flexible indexing capabilities offered by new technology," said Mary Ann Hardy, image product development manager in the bank's cash management division.
According to the Tower Group, the banking industry as a whole has yet to fully embrace check imaging.
Despite the promise of operational improvements and fee opportunities, fewer than 5% of U.S. checks are imaged for any application, the firm estimates.
This number could rise dramatically in coming years, if more banks buy into to operational benefits touted by image systems for the proof of deposit function.
But even if investment in image-based proof systems does not occur, niche applications, such as the new Bank of Boston corporate product, are still likely to proliferate, experts said.
In the Bank of Boston system, check images are captured and stored by an optical disk system which in turn writes the data to the compact disks that will be used by corporate customers.
Customers may search for items using such basic information as a check numbers, dollar amounts, or paid dates. The system software also allows the customers to search by name, Social Security number, or account number.
"Currently, customers receive microfilm of checks that are paid, and it is often hard to access the information," said Charles Pierce, product line manager for collection and disbursement products at Bank of Boston.
"This system literally puts all of the information they need at the customers fingertips."
"We believe this will let clients resolve telephone inquiries, while the payee or customer is on the phone," added Ms. Hardy.
Bank of Boston, with assets of $44.3 billion, plans to test the system in January with an insurance firm and mutual fund company.
It expects a complete rollout after a 60-day pilot.
The components of the system include a proprietary, Windows-based retrieval system, a CD-ROM Enterprise Authoring System from Data/Ware Development Inc., and IBM Corp.'s High Performance Transaction System. The software operates on a 486 personal computer with a CD-ROM drive.
Marianne Crowe, director of deposit technology at the bank said investing in CD-ROM technology is a key step in Bank of Boston's long-term strategic plan to improve its operational process and maintain its commitment to cash management services.
"CD-ROM is only the first of a number of new products the bank will roll out in 1995 utilizing the check image technology platform," said Ms. Hardy.
The bank has not determined what it will charge for the software that corporate customers will use to access the check images.
But officials said there will be a one-time installation fee, a peritem fee, and a monthly or weekly maintenance fee, depending on the service.
The bank also plans to develop an imaging product for exception items that will be available to customers either late in the first quarter or early in the second quarter.
