Society National Bank has signed an exclusive agreement with Checkfree Corp., a consumer and electronic payment processor, to provide Automated Clearing House origination services.
The Cleveland-based bank, an affiliate of $61.5 billion-asset Keycorp, is acting as a conduit for the delivery of Checkfree's electronic payments into the automated clearing house network.
Society will pick up over two million transactions processed each month by Checkfree, more than doubling the bank's current ACH volume, said Terri A. Ambrose, Keycorp's assistant vice president and ACH product manager. The agreement solidifies the bank's position as one of the largest ACH originators, she said.
Although Columbus, Ohio-based Checkfree does processing for the bill payment portion of MasterCard's MasterBanking home banking service, the agreement does include these transactions, said Society officials,
The bank is providing Checkfree with risk identification reports: daily summaries of Checkfree transactions that flag accounts with unusual activity. This will help detect fraud, said Society officials.
David Garrison, vice president of finance at Checkfree, said, "We're very excited about our growing relationship with Society."
Checkfree transferred its relationship from another financial institution - which Checkfree spokespeople declined to identify - to Society because the bank "is very aggressive in the ACH arena," and offered services "more in line with the needs we have as a bill payment provider," said Mr. Garrison.
Businesses and consumers using Checkfree's services can pay bills using a personal computer or touch-tone telephone, and companies can process and pay invoices. Checkfree markets directly to consumers and businesses, and provides its services through financial institutions.
"As electronic funds transfer technology continues to revolutionize and expedite the way we transact financial business, we're now better equipped to respond to the rapidly changing needs of our customers with enhanced products and flexible services," said Mr. Garrison.
Society's relationship with Checkfree provides an opportunity for the organizations to jointly develop and market future electronic payment products to consumers and businesses, said Keycorp's Ms. Ambrose. Society, which has been involved in the ACH network since its inception, already acts as an originator for major utilities in Ohio.
"The ACH network provides a reliable, secure, convenient and more cost effective payment mechanism," said Mark K. Strippy, assistant vice president and manager of ACH operations at Keycorp. "Its success is illustrated in that more than $8 trillion were sent through the ACH network in 1993."
Checkfree offers electronic payment and collection to over 1,200 businesses and 4 million consumers across the country.
The company recently announced agreements with two online services, Apple Computer's new E-World and Ziff-Davis' Interchange Online Network, and the MinnComm paging service company in the Minneapolis/St. Paul area.
Checkfree will provide electronic payment processing services to the three organizations, enabling each to automatically receive payments from credit card or checking accounts.
According to Checkfree officials, these agreements make Checkfree the leading provider of electronic payment services to on-line and wirelesS providers. Other Checkfree clients in these industries include Compuserve and Cellular One.