Nacha, the electronic payments association, hopes to be ready to invite banks by April 1 to participate in its Deposited Check Truncation project for clearing checks over the automated clearing house network, despite questions about whether the project is necessary.
Elliott C. McEntee, the Herndon, Va., trade group's president and chief executive, said in an interview Monday that a study group is considering three issues: the dollar limit on check eligibility for the project, how quickly collecting banks would have to get an image to paying banks if customers want a copy of cancelled checks, and the role of correspondent banks.
Nacha revived the idea of clearing checks over the ACH network in September. The Check ACH Coalition spent much of 2006 studying ways to use the system to clear checks, but that effort foundered over several operational and legal issues.
Richard R. Oliver, an executive vice president at Federal Reserve Bank of Atlanta, questioned the need for such a check-clearing system this month at the Bank Administration Institute's TransPay conference in Dallas.
"There are fewer and fewer people interested at this time," Mr. Oliver said during a Fed "town hall" session in response to a question from the audience.
The growing use of image exchange could make another clearing system unnecessary, he said. "Nacha needs to make a decision whether to launch this pilot."
Danne Buchanan, an executive vice president at Zions Bancorp. of Salt Lake City and Nacha's vice chairman, said in the interview that economic conditions and falling banking profits could make it harder for financial companies to justify the expense of participating in the project, though Zions has said it would do so.
Also, the growth of image-enabled banks has alleviated some concern that the industry would need this mechanism, he said. "A year ago looked better for doing something like this than a year from now."
