DENNIS CHAPMAN Manager, electronic products Harris Bankcorp Chicago

CORPORATIONS MUST first make electronic data interchange an overall priority, and the payment piece will follow. Our research indicates that a number of corporations did just that three to four years ago and are now beginning to move into payments. Implementing EDI is a big change and it is difficult to break down the traditional barriers to change.

But banks need to make it easier for their clients to do business using financial EDI. One way is using Edibanx, a new national electronic commerce network developed by some of the leading cash management banks and the Chicago Clearing House Association. One of the primary benefits of Edibanx is a trading partner directory that facilitates the identification of willing trading partners, one of the biggest hurdles to implementing a successful EDI program. Nacha (the National Automated Clearing House Association) is doing something similar to Edibanx in its efforts to provide software to smaller banks to make them more EDI capable.

Also, it is important for bankers to become more knowledgeable about EDI in general and then take on an advisory role with their clients in financial EDI implementation.

*** RICK HOLLAR Senior product developer First Union Corp. Charlotte, N.C.

EDUCATION WILL CONTINUE TO BE an issue until banks are able to inform their customers of this technology and the process that goes into EDI. If banks can play a consulting role by sharing ideas and option with their corporate customers, then both the bank and customer will be well-off.

EDI is not profitable yet, but will be in the future. Banks now have to persuade their customers that it is the right strategic move and, in the long run, it will fit in with their business direction. And segmenting the market will be invaluable to the bank if they are looking at the right customers.

Banks should help customers solicit EDI trading partners. What are customers looking for? They are not only looking for an EDI-capable bank, but also the perks - software packages, communication links, and an idea where the industry will be.

*** CHIP WICKENDEN Manager of electronic commerce Barnett Banks Inc. Jacksonville, Fla.

THERE ARE DIFFERENT LEVELS of EDI capability, and eventually all banks need to have some level of receiving capability to truly broaden the field. Currently there are enough EDI-capable banks. Most of the major corporate cash management banks are able to meet their customers' EDI needs, and Nacha has put together a program that will expand the receiver pool significantly.

We are starting to see significant growth of financial EDI. But our industry still has a critical need to build its customer base through education, promotion, and demonstration of the benefits of EDI.

EDI involves a tremendous learning curve for banks that are participating as well as for our customers, and this is a key reason for the longer sales and growth cycle. Banks can play a positive and profitable role by contributing as broadly as possible in educational and informational events and forums.

At Barnett, our first two customers were the bank's purchasing and accounts payable (departments). Every bank has these opportunities, and it's a good step either to get started or to further develop an EDI program.

*** NICK ALEX Senior vice president, corporate electronic products NationsBank Corp.? Atlanta

THERE ARE SEVERAL customer-oriented obstacles that have to be overcome in order to break the logjam.

One obstacle is the cost of the software itself. But more important is finding trading partners who will do financial EDI with you. In other words, you don't even know how to find in your accounts payable vendor list or your accounts receivable customer list those companies who would be willing to do financial EDI with you.

Then you've got to have an intelligent bank on both ends of the transaction. And one of the difficulties has been the ability to determine if the trading partner you want to do financial EDI with deals with a truly EDI-capable bank.

The way the industry has addressed these things is specifically to try and overcome these obstacles through a new organization called Edibanx. We set out to actually tackle the issues of finding trading partners.

*** GEORGE C. WHITE President White Papers Inc. Montclair, N.J.

ORIGINATORS OF FINANCIAL EDI TRANSACTIONS (on the corporate side) are very concerned with the inability of many financial institutions to handle the description of the EDI payments, particularly to receivers that handle only a few transactions per day.

EDI software is now being made available to smaller institutions. The New York Automated Clearing House is making this available free to its members to enable that payment detail to be handled by various means such as (being) transmitted by fax. As software solutions become available, hopefully some will make use of it.

I've suggested using existing bank software that now enables consumers to inquire about their available balances, last check number, that type of information. (It) could be adapted to allow receiving corporations to inquire for the invoice release number and the amounts of transactions. But I don't know of any institution doing that as yet.

Whenever there is a problem, it's going to be solved. But I think the banks have been slow in solving it. But someone's going to solve it.

The Internet might be the way of solving (situations) where someone does not have an established volume that enables them to do it directly to the corporation from the bank.

*** FRANK CESARIO Vice president of product development Northern Trust (and chairman of Edibanx) Chicago

LARGER CASH MANAGEMENT BANKS have responded well in developing capabilities to support financial EDI.

Those financial institutions which lack the ability to become EDI capable are primarily looking at the short-term investment costs instead of the long-term advantages. If you talk to most institutions who have invested in financial EDI, they are not showing that their investment is paying off yet. Most have invested short term to support the needs of their corporate relationships, with the expectation that over the long run the volume will begin to offset the costs.

A key issue that is needed for companies to more broadly embrace financial EDI is a large pool of identified electronic trading partners. Most companies identify trading partners one on one. This approach prohibits the ability to reach any kind of critical mass. This is one of the key issues that we are addressing in Edibanx; the ability for companies to access a data base of identified electronic trading partners. The data base will allow companies to easily match their accounts payable file and readily determine trading partners that are willing and able to handle and originate payments through one of the Edibanx member banks.

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