After a slow start, banking technology that lets businesses deposit checks electronically and remotely is now taking off, and smallbusiness banks are leading the charge.
With remote-deposit capture (RDC), businesses use a desktop
device—typically provided by the bank—to scan received checks electronically
and securely transmit the scanned images to their bank for deposit.
It saves time (and gas) by eliminating the need for daily
runs during business hours to bring paper checks to the bank. And it also
narrows the gap between the time a business receives a check and the time it
has access to the actual funds.
RDC is proving to be so successful among large national
banks that smaller regional banks are getting into the action. Example: Two-year-old Heritage Bank, a
community bank in Topeka, Kan., now offers RDC to its small-business customers
after patrons said the service removed the cross-town, geographic objection of
doing business with the bank.
Meantime, PNC Bank in Pittsburgh recently expanded a pilot
RDC program nationwide after its survey found that at least four of 10 small
business customers visit their local branch at least once a day.
PNC’s “Deposit Now!” service lets small business owners feed
paper checks into a scanner and send electronic images of them from an ordinary
desktop or laptop PC to the bank at any time of day. The bank then converts the
checks to paper substitute checks and deposits them into the business owner’s
With accounting software (PNC’s system links with
QuickBooks, the most popular small-business accounting software), payments are
automatically matched to invoices and books are balanced. The images are stored
in a searchable database for future research and audit trail.
At the same time, big banks are fine-tuning their RDC
offerings for smalls.
Latest twist: Wells Fargo & Co. tweaked its basic RDC
formula by offering both a desktop and Internet-portal version of its RDC
service. Dubbed “Desktop Deposit,” the service lets small businesses scan
checks at their desks, key in dollar amounts and send the deposit to the bank
electronically. Wells Fargo’s target: Smalls that don’t have a lot of check
volume but perhaps receive high-dollar checks they want to have deposited
What are the risks? Mistakes—such
as a check clearing twice, perhaps once as an image and again as a substitute
Also, if a business isn’t careful to lock original checks
away, they’re at risk of being stolen. And banks may also be held liable for
passing along low-quality check images that are read incorrectly.
With all that in mind, some banks are looking more closely at client financial strength, credit reviews and other criteria before giving RDC capability to small firms. Expect to have to sign an agreement that guarantees the images you create are accurate and authentic.
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