For decades there has been a dichotomy in the transaction processing methods used by U.S. financial institutions.
Most commercial banks have favored a batch approach, allowing them to acquire large volumes during business hours to capture and post in a nightly update. Thrifts and credit unions, on the other hand, have leveraged their lower-volume environments and used real-time systems to provide more timely and accurate information to customers and members.
With the distributed capture technology available today — and, in some cases, already implemented — there is no reason banks cannot process transactions in real time to eliminate another financial institution's competitive advantage and serve customers better.
As an example, a thrift system typically can provide a customer making a loan payment with a receipt immediately that includes the exact breakout of interest, principal, and fees paid. A commercial bank system typically provides the customer with a receipt showing only the amount paid and makes the details available later.
A hybrid solution — the sort-of-real-time memo post approach — has gained popularity in recent years. This allows a commercial bank to show the impact of a transaction during the day without actually posting it until the nightly batch process.
The problem here is the "sort of." The demands of today's banking environment are pressing all financial institutions to offer a real-time view of all activity across all delivery channels. ATM, debit card, Internet banking, teller, and other activity affect a customer's accounts during the day, making it more important than ever that the channels be in lockstep.
Again, if your bank is offering or plans to offer merchant capture, why not take full advantage of all the technology's capabilities?
By automating the capture of large deposits, merchant capture systems, which are already in use at banks nationwide, provide a key element in a move to real-time processing.
Today a typical commercial deposit accepted at the teller window is held for processing later, with no evaluation of the individual items contained in the deposit. Moving the image-capturing process to the merchant site makes items available for analysis and posting upon presentment by the merchant. The impact of these transactions can be reflected in the bank's accounting system and passed to various delivery channels — in real time.
Not only should banks adopt real-time processing, but they also should tout it as a benefit to customers and a time- and resource-saver for their financial institutions.
In addition, high-value items can be identified and presented for earlier availability, increasing same-day investable funds.
Through distributed capture, presentment for all items is streamlined, allowing the bank to offer later same-day availability to its customers while meeting earlier deadlines for transit items.
Finally, teller counter traffic is significantly reduced, enhancing customer service, as the larger business deposits no longer have to be handled by branch personnel.
For institutions seeking a real-time environment, distributed capture, especially for high-volume customers, is an important step in that direction. The technology is available and working in many banks today. The next step is realizing these benefits internally and externally.
