Capture the (Deposit) Flag

Grow Financial Federal Credit Union increases interest income and cuts courier costs

Originally published in Credit Union Journal by W.B. King

Reprinted with permission.

August 15, 2014

TAMPA, Fla. — Grow Financial Federal Credit Union wanted a technology tool that captures results and interest so it invested in teller capture solutions.

But that doesn’t mean that the $2 billion CU wasn’t interested in continuing to improve on its initial success with the offering, which is why it has adopted Henderson, Nev.-based Bluepoint Solutions next-generation solution, ImagePoint Teller Capture.

“In the new version, they have centralized all forms of capture: branch, remote deposit capture, mobile capture and merchant capture,” said James Stock, assistant vice president of network services at Grow Financial FCU.

Now, when an item is presented on one channel, it can be detected in another, which prevents fraudulent or accidental double posting of checks.

“In the older system, these were separate systems that did not talk to each other so you could have fraud occur or members could accidentally post an item in mobile capture, then bring the check in,” Stock said.

Reading Is Fundamental
In an effort to better educate the industry about benefits and advancements in teller capture, as well as related costs, Bluepoint Solutions Chief Marketing Officer Andrew Tilbury recently wrote a white paper titled, “What is the True Cost of Teller Capture? Calculating the Total Cost of Ownership is More Complicated Than it Appears.”

“There is a lot of misinformation in the market about teller capture solutions — the benefits, the costs and especially the hidden costs,” he said.

“The goal of this white paper was to educate credit union IT professionals and executives on the cost elements that are not obvious upfront. These should be included in an RFP or vendor selection to prevent costly missteps,” Tilbury said.

Among leading takeaways were tips and facts related to the following points: transaction validation, cross-channel duplicate detection, scanner support, system reliability, portability and flexibility, and processing partners.

“By including these on a teller capture [request for proposal], you will be able to better understand the financial investment that your credit union is making,” Tilbury said.

Grow Financial FCU initially adopted Bluepoint’s Check 21-compliant Teller Capture in 2006 when the solution was in beta mode, Stock said.

The $2 billion CU, supporting 170,000 members with 500 employees and 22 branches, took a measured approach to rollout.

“We spent approximately three months doing beta testing and then ran for about three months in dual mode to get users used to working with the system and allowing enough time for IT to replace the computers on our teller lines and swapping the noisy old dot matrix printers for the thermal printers and adding scanners and signature pads,” Stock said.

If not for these early efforts, the new version — ImagePoint Teller Capture — likely would have been delayed.

And while Stock said that his team didn’t beta test this latest offering, the CU did help the vendor “through some issues.”

From a work station perspective, the technology involved with the teller capture product includes check scanners in various speeds and sizes. And depending on volume, Microsoft’s .Net software and Bluepoint’s teller capture software is required.

When it comes to the server, it depends on how a CU leverages the solution, Stock said.

“If a third party hosts the ‘hub’ then a server with Bluepoint’s image relay software would be required,” he said. “If you’re hosting your own items, then a dedicated server for the hub would be required, along with the connectivity involved with transmitting the X.937 files and check images would be required.”

Does Size Matter?
With ImagePoint Teller Capture, checks are processed and validated in real-time against third-party databases for items with the highest likelihood of return or known counterfeits, Tilbury said.

As such, CUs are able to notify members of a potentially risky deposit.

Although Tilbury said that the solution is scaleable, depending on the size of the CU, the approach could be different.

“Because larger credit unions have larger branch networks and more tellers, they will reap greater benefits from a teller capture solution in terms of how it impacts their operations,” he said.”Smaller credit unions, however, can less-easily absorb the overtime costs and workloads caused by processing exceptions that make teller capture an attractive technology.”

For smaller CUs selecting a solution that lowers the total cost of ownership is critical, Tilbury said.

“Since many smaller organizations can’t afford to maintain multiple, disparate check processing systems, they frequently work with a corporate credit union or [credit union service organization] for substantial portions of their check processing,” he said.

Depending on the scope of the CU, the solution can be implemented in as little as a few weeks or it can take up to a few months.

“There are software and hardware components to teller capture. The scanners are the most significant hardware cost,” Tilbury said.

“Implementation is usually a routine process and training can be done in a couple of hours,” he said.

Grow Financial FCU’s help desk was affected the most by the initial roll out because the department was physically swapping hardware while building out to all the users, Stock said.

“Our accounting and adjustments teams had to adjust procedures and policies based on how quickly transactions were happening,” he said. “Our training department was impacted as they had to instruct users on how to use the system and develop training materials.”

Stock advises CUs looking at similar implementations to run in dual mode as it helped his team with adoption without penalty. This approach allowed the tellers to use the new process without affecting operations.

“Making sure that back office folks knew how to take advantage of new research capacities would be a must,” Stock said.

With regard to improved efficiencies, he said that the biggest impact has been the speed at which fraud is detected, from bad checks to the ability for any service member in the organization to instantly retrieve a copy of a check deposited from disparate locations as soon as they were scanned.

“This tremendously reduced the load on the research groups and allows us to provide faster service,” Stock said. “Our members were also experiencing better service because checks could be evaluated much faster if they had a request for funds to be made available quicker.”