Check scanners! It’s a riveting topic, we know! We live in a digital age where direct deposit automagically moves money electronically from Accounts Payable to your bank account. Huzzah! Even smartphones can handle these transactions now. It’s crazy (awesome). But some businesses and most banks are behind the times and, instead of keeping things digital, bills are paid by writing paper checks—which is more advanced than chiseling marks on a stone tablet (but not by much).
So as it goes, we can put a man on the moon 50 years ago but, fifty years later, we still move money around with calligraphic ink swirls on paper slips specifically designed for deposits (aka checks). Those checks get popped in the mail because paper mail still also exists in an age of IoT-powered everything. Once the postal service delivers the mail, those checks come into your company’s mailroom to be sorted and dealt with. Dealing with them means turning them back into digital entities.
That’s one clunky digital–to–analog back–to–digital process, galldangit. But these are the times we live in and financial institutions aren’t even close to revolutionizing how they handle corporate deposits. So… how do you take the money you’re owed on paper and stuff it into your bank account quickly? Well, single checks can be deposited by taking a photo with a smartphone. But that method doesn’t work well for companies where dozens of checks land in mailrooms daily. Businesses need a more efficient process. That’s where check scanners come in. Yay!
If you have a workforce that’s spread out geographically or if your staff works from home, it’s important to streamline your operations and keep cash flowing. For businesses and institutions that accept check payments, remote check deposit and remote deposit capture technology (RDC) is the name of the game. The FDIC estimated that in 2008, 88% of major US banks, including Citibank, PNC, and Bank of America, offered some form of RDC to their customers. In the decade since that number is closer to 100%.
If you’re considering launching a remote work environment, you might wonder, “What do I need to set up remote deposit capture for my business?”
You need a check scanner. And you need to talk with your bank to get your check scanner talking with their system.
How Check Scanners Work
Check scanners, like the Canon remote scanner line, read both sides of a check and create a digital image using precision light sensors. Those sensors detect the differences in light density in order to create a map of the check’s face. Cool, right?
The check scanner then reads the account and routing numbers at the bottom. These important numbers use a special kind of ink called MICR for printing, which stands for “Magnetic Ink Character Recognition.” MICR has been around for decades and is highly reliable when used with scanning technology. Once scanned, the check scanner sends the digital information to your bank and the clearing process begins—show me the money!
The Benefits of Using a Check Scanner
Check scanners and remote deposit captures have steadily gained popularity in parallel with the demand for fully-electronic fund transfers and payments. RDC gives check-based industries a way to compete with electronic email transfers, reaping similar benefits in the process.
RDC’s greatest advantage is the convenience it provides to customers who use it. With remote deposit capture, “going to the bank” becomes a yesteryear sort of thing (can we get a whoop whoop?). Standing in bank lines was never the best part of the day. Conveniently, customers can transact deposits from locations far outside the bank’s geographic footprint—amen! The benefit is two-fold: the customer doesn’t waste valuable time or spend money on transportation. The bank gets things done more efficiently and doesn’t have to spend money on expensive geodemographic analysis typically required before opening a new branch. No new branch necessary.
Funds are available faster
Checks deposited in person generally take 3 to 5 business days to clear. That means 3 to 5 days before your funds are available for use. With an in-person deposit, the bank must process physical checks manually. This process involves sending the check to the payer’s financial institution, or in some cases to a third-party intermediary called a clearinghouse. Once the clearinghouse or bank verifies the validity of the check, the funds are finally released.
Delays occur because your bank waits until the end of business or the next day to scan and submit checks to clearinghouses and coordinate large batches. With RDC, you cut out the middleman by scanning checks yourself, submitting them on an as-needed basis. As a result, the turnaround time for RDC is generally only 24 to 48 hours.
Faster return item notification
Because you’re cutting out the middleman by using a remote check scanner, you also have more immediate feedback if there’s a problem with your checks clearing—minimizing cash flow shortages.
Lowered operational costs
From the bank’s perspective, remote deposit capture means a radical reduction in operational costs. From savings on the man-hours necessary to process manual checks, to transportation costs and time spent scanning checks submitted via ATM, RDC means the bank spends less time and money taking care of your assets.
From a company perspective, the cost to implement a remote check scanner is anywhere from $1000 to $2500 depending on the caliber of the machine and the number of checks you will process each day. The Canon CR-150 check scanner is a good fit for low-volume check processing and Canon CR-190iII is the most popular model for high-volume each day.
Long-term financial archiving and security
Here’s where we talk about the secure paper trail that check scanners generate. Electronically scanned checks are stored in a digital archive format once scanned. All your company’s deposits are easily reviewable using the accompanying software. In many cases, cloud-based services store those documents—which adds a second tier of archival security. Advances in digital security methods, as well as the direct nature of remote check scanning, makes this one of the most secure methods available for depositing checks. Some of the more common check processing software products/vendors include; Fiserv, Bluepoint, Northwest Bank Technology, Jack Henry, Harland, WAUSAU, and Fidelity National Information Services (FIS).
The Benefits of Integra PaperLESS
Aside from the fact we’re fun to chat with about check scanners, Integra PaperLESS Business Solutions has some great questions that help you pick out the check scanner you’re looking for. There it is! We’re looking at it right now. If you want to look at it too, give us a ding. We offer a full line of services and products to help you get up and running with electronic deposits. We are proud to feature Canon check scanning products that are easy to set up and use in your own business or home office. Contact us today to find out more about our remote deposit capture solutions.