Three of the largest check acceptance companies in the country plan to participate in PrimePay, a check authorization service from Primary Payment Systems Inc.

National City Processing Co., TeleCheck International Inc., and Equifax Check Services Inc., which collectively verify or guarantee nearly 20% of all checks accepted nationally at retail locations, will be able to access PrimePay's data base of 25 million checking accounts.

"We are extremely pleased to be able to provide this service to these companies and in turn assist the retail industry in reducing their check losses," said Larry Spooner, president of Phoenix-based Primary Payment.

Primary Payment Systems was formed last year by San Diego-based Star System Inc., the biggest regional automated teller machine network in terms of number of transactions a month.

By using PrimePay, the three check acceptance companies will receive account status codes that will provide early warnings of impending check returns that can then be passed on to retail clients.

Retailers are expected to benefit from reduced losses from checks written on closed accounts or accounts with insufficient funds - two categories that represent 38% of retail check-related losses. The retailers should also experience lower operations costs associated with returned checks and collection handling.

The PrimePay data base is updated daily with information collected electronically from the deposit account systems of participating financial institutions. Eighteen of the country's largest banks currently contribute information to the PrimePay data base.

"The information being provided by Primary Payment Systems is the most current account data available anywhere in the financial industry," said Tom A. Wimsett, executive vice president of National City Processing.

Cash Station Inc., a midwestern electronic banking network, purchased an equity stake in the nascent company earlier this year. Primary Payment wants to attract other equity owners among the regional networks and large banks.

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