Zions Bank has a picture of what exceptions workflow will look like in the future, and it's an image.
The bank will use an image-enabled exceptions application from Fiserv in an effort identify exceptions earlier. It also hopes to determine the cause of misinformation or data gaps on checks and other forms and give staff a series of options to seamlessly act on exceptions by integrating the Fiserv product with its processing systems.
"[The deployment] creates efficiency because it allows us to see exceptions on one screen, get the reasons for the exception and see the front and back of a copy of the check," says Frank DiPuma, svp and strategic planning manager for the $17-billion asset Zions, headquartered in Salt Lake City. "We can now look at a payment image and say 'this is a match' versus typing and keying [into another system]."
Checks and other payments can be flagged against a bank's or corporate client's criteria for several reasons-a signature that doesn't match one on file; a bar code that doesn't register, or other irregularities such as possible fraud. Any flag delays execution of a payment-and banks are already under pressure to balance fraud detection with ensuring that corrections to payment forms with typos and false positives are moved through quickly.
To meet the demand, tech firms like Fiserv and FIS are building out cross-channel workflow systems to ID and manage exceptions within the workflow. "Because you're not making bank employees go to separate (systems), there's a tremendous among of value in that," says James Van Dyke, founder of Javelin Strategy & Research.
Zions, which is deploying Fiserv's Exceptions Workflow, already uses automated account reconciliation. By adding the exceptions workflow module it will be able to access data for research and decision-making on exception actions. The system also enables the bank to handle more positive pay and payee verification accounts, control exception handling costs and ID potential check fraud.
DiPuma says the bank's old exceptions process included archiving payment images into a separate application, which required manual intervention to fix mismatches.
M.J. Forry, director of product management for Fiserv, says it typically takes about 45 seconds to fix a mismatch, a time that would be shaved to a few seconds by using the new technology. "It actually shows you what's wrong with the check and what actions to take to generate an exception," says Forry, adding the system identifies each type of payment mismatch and the possible fixes, all in a single-screen automated format. The system also enables the bank's management to monitor the work of internal staff, an extra safety measure.
The Web-enabled J2EE exceptions imaging was developed by Fiserv last year, and Zions is the first client. The product is an online real-time reconciliation system that combines imaging and workflow to route and manage positive pay and ARP exception items, including Day 1 corrections.
The product is designed to reduce the need for extra staff or resources, because of workload improvements like distributing exceptions throughout the day instead of in a batch. There's also a fraud component-it does both Day 1 and Day 2 corrections of positive-pay exceptions.
Rival FIS' image-enabled product, Protect21, examines payments across channels and distributes images of exceptions or flagged transactions to the department that's able to investigate and fix the mismatch.
"An example would be a payment suspected of fraud is reviewed in the back office, and we can then route the payment electronically out to a bank officer who can review the transaction and the images [connected to the payment,]" says Matt Bowen, an svp at FIS. "That officer can make a decision and document that decision so if anyone wants to review the payment, they can."
Protect21 performs a consolidated review of items on an account as well as a number of tests to identify possible fraud and other crimes while reducing false positives. It's offered through a partnership with Advanced Software Design Corporation and includes forensic signature verification, transaction account protection and positive pay.
Bowen says FIS system is offered in a lockbox environment, and can be accessed by corporate clients, which can view exceptions through an individual workflow that's set up for the corporate client by the bank and FIS.
