Fifth Third Integrates Check-Image Tool

As remote capture of check images enters its second generation, banks increasingly are integrating the processing of check images with their other systems.

The $99.8 billion-asset Cincinnati banking company Fifth Third Bancorp recently licensed remote-capture technology from Wausau Financial Systems Inc. in Mosinee, Wis., to complement retail and wholesale lockbox systems from the same vendor. Related Links The Tech Scene: Fifth Third Putting Image Foundation to Wider Use
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Lisa Tiemeyer, a vice president at Fifth Third and its receivables product-line manager, said the company replaced an existing remote-capture system that required software to be installed on customers' computers.

The company began a pilot in late June and is now in commercial operation with multiple clients, she said.

"It meets our requirements for end-to-end integration," she said. "In addition to capturing the deposits, we can capture the receivables data as well."

Steve Buchberger, Wausau's senior vice president of solutions management, said Fifth Third is one of five customers his company has signed up in competition with incumbent vendors since March. He would not identify the other banks but said Wausau expected to announce some of them this year. "We're seeing this as an accelerating market," he said. "It's causing banks to look at what is their long-term strategy and platform."

Bob Meara, a senior analyst at the research and consulting firm Celent LLC in Boston, wrote in a July report that remote deposit is an "adolescent market" that is just entering its first replacement cycle.

In an interview Monday, Mr. Meara said integrated systems are likely to become more prevalent, linking remote capture with lockbox, and could even open a new market for banks, commercial companies with revenues of $50 million to $250 million.

"There's an awful lot of invoice processing going on there," but the scale is too small to be economical for conventional lockbox, he said. "If you take just the capture part of it and distribute it back to the client," the approach could offer new processing opportunities to banks, "as long as the price is right."

Wausau's system has been licensed for 10,000 remote-capture users, Mr. Buchberger said. The company announced last week that its WebDDL system, originally called Digital Deposit Lockbox, has been upgraded with Internet-based tools and remittance capabilities. "It's not only a remote deposit system," he said. "It's a remote lockbox system."

The remote-capture system uses a "thin-client" architecture that lets banks house the system on their own computers, rather than on their customers' computers.

For retail payments, a company typically would use a check scanner to capture images of its check and payment coupons, and for wholesale payments, the company could use a common flatbed scanner, he said.

This is useful for "stranded payments" that are routed to a company's headquarters rather than its lockbox, or for businesses such as insurance companies whose agents receive payments, he said.

When remote capture came on the banking scene in late 2004, one of the first innovations to result from the Check Clearing for the 21st Century Act, many early systems required software to be installed on customers' computers, he said. "There is momentum now, a lot more sites being deployed. It's hard to maintain that model."