The Federal Reserve announced this week it is raising the cost of paper-check processing a whopping 41 percent beginning in 2009, hoping to prod those institutions that have been lagging in electronic truncation.
The new charges are also a result of simple volume numbers: the Fed expects to process 90 percent of its volume electronically by the end of the year, which will result in higher per-unit shipment and processing costs for paper checks. The Fed earlier this year also sped up the consolidation and closings of regional processing centers as check imaging continued to gain more footing in the industry.
TowerGroup has previously reported that U.S. check volume is expected to decline to 17.9 billion items next year.
