On paper, the idea of forming third-party service bureaus to deliver image-based check processing looks solid. Banks that are too small or too wary to experiment with imaging can pay a service provider to do it for them, allowing the bank to compete with its bigger competitors and stay abreast of technology.

The service provider absorbs the steep start-up costs and learning curve associated with image technology, and reaps profits as other banks clamor for its service.

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