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In light of check electronification, the business of cash letter processing will undergo a rapid transformation. Over the last 10 years, many financial institutions have exited correspondent banking because low interest rates have made this a low margin commodity business. The business is changing because paper cash letters can be replaced with image cash letters. Banks that have invested in a Check 21 platform to enable receipt and processing of image cash letters now have an opportunity to reach outside their geographic footprint to build volume and market share. Banks that have the capability to produce outbound image cash letters can expand and accelerate their clearing options through participation in Image Exchange or simply image cash letter presentment to a correspondent bank. Banks once reliant on the local Federal Reserve Bank for transit clearing can pursue alternatives through the strategic deployment of correspondent banking relationships or simply benefit from pricing incentives offered by the Fed for image presentment in lieu of paper.
Ultimately, those financial institutions that are still dependent on paper check processing will find themselves at a distinct disadvantage in this new marketplace.
Today, NetDeposit® is the clear leader in technology solutions designed to enable banks to take advantage of image cash letter processing in support of correspondent banking. These solutions allow you to offer cash letter products to your correspondent bank customers and participate in the benefits of image cash letter send, helping you to reduce costs, win business, and expand your market.
NetDeposit enables correspondent banking by empowering banks with an access-ready on-ramp to both image cash letter receive and send capabilities that leverage investments made in image capture and image archive. The NetDeposit solution:
- Provides a platform for secure receipt, MICR and file validation, and image quality analysis of incoming files
- Enables file acknowledgment and adjustment notification
- Supports item-level sorting or file-level routing for optimal distribution and clearing
- Supports Federal Reserve Bank compliant and other variant X9.37 file formats for both cash letter receive and send
- Interfaces with legacy check, archive, and posting systems
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