Save time on banking Featured

8:00pm EDT October 26, 2009

If you’re spending too much time traveling to and from your bank — not to mention the time spent parking and waiting in line to make your business’s deposits — you’re wasting more than time. You’re wasting money and valuable company resources.

And don’t think it’s any different if you send someone else — many times when you send employees in your place, they don’t just go to the bank, they also run a few errands of their own.

But you can streamline your processes, saving both trips to the bank and money, by using remote deposit capture, an online banking function that allows businesses to scan checks and then transfer the images electronically to the bank for posting and clearing.

“Besides saving you time, remote deposit capture helps you maximize productivity in the office,” says Christine Thompson, vice president of branch administration at First Place Bank. “Plus, it’s safer. Instead of having your employees exposed as they travel to the bank with checks, they stay safely inside while the bank processes your hard-earned funds.”

Smart Business learned more from Thompson about remote deposit capture, how it works and how it can benefit your company.

How does the remote deposit capture process work?

Once you start a remote deposit capture program with your bank, you’ll receive a scanner, which you’ll use to scan customer checks as your business receives them. Once a check is scanned, an electronic file is sent to your bank, and the bank will then process the check.

The original checks never leave your business and can be destroyed after a certain period of time. The images, however, remain available to you via an online system for up to 90 days, and you’ll have access to them for any customer service inquiries or audits.

How can remote deposit capture improve recordkeeping, increase productivity and reduce costs?

Everything is electronically filed and stored, so there’s less of a chance for human error. The remote deposit capture system will make sure that deposits balance before the process is completed, which further decreases errors.

If your company has more than one location, each location can scan the checks it receives and deposit them into a single account at one bank. Therefore, the owner will always be able to see all the images deposited into that account from multiple locations. Plus, audits will be less burdensome because information is readily available and easily accessible.

Again, it increases productivity and reduces costs by saving the time and expense of having to make trips to the bank, and the owner can use his or her time and money more productively.

Another benefit comes from speeding up cash flow, which accelerates the clearing process, which lessens the amount of time you’re waiting for the funds to be available.

Are there any downsides to remote deposit capture?

There is some potential risk for insider fraud, but there are ways to control it. Typically, remote deposit capture services prevent problems or issues within a company, unless all access is assigned to one individual and he or she has full control of the information and transaction initiation. Therefore, you have to have a separation of duties to reduce the risk of fraud.

Also, banks usually provide training on how to use the system and the best practices to reduce fraud. They will also provide you with a contract defining who is responsible for what. During the time frame that you are responsible for the physical checks, make sure you have a policy about where you store them and how you destroy them.

Is there a risk of consumers’ personal information being compromised with this process?

A consumer’s checking account number is on the check whether the check is taken to a bank or scanned at a remote location. All programs are encrypted and password protected to ensure security and protection of information. The bank’s contract usually defines how the physical checks should be stored and then destroyed after a certain period of time. No matter what, your customers’ information will be protected.

Does using remote deposit capture require a financial investment?

Yes. There is the cost to rent or purchase the scanner and/or there may be some per-item costs, but they tend to be lower than when presenting paper. Plus, if you keep your balance high enough in your account, the bank may waive the fees. For most businesses, there is a cost savings with using remote deposit capture.

The cost of scanners is similar to the cost of a modest PC or copier, and there are minimal increases in operating costs in most cases. The product can pay for itself very quickly by increasing productivity and decreasing transportation costs.

The product also may speed up your cash inflow because it allows you to conveniently make deposits every day, providing you quicker access to your money, which, in turn, may reduce your borrowing costs or increase your interest income.

Christine Thompson is vice president of branch administration at First Place Bank. Reach her at (248) 386-9876 or