Should check imaging be installed at the teller counter or back office? That’s the question for retail banks as they begin implementing deposit capture technology on the front line. And the answer, according to a panel of experts, depends on the bank’s — or even individual branch’s — mix of business.

“You really have to take a look at what type of deposits are coming into the institution,” said Michael Jucht, a front counter image capture product manager with Information Technology Inc., a unit of Brookfield, Wisc.-based Fiserv Inc. Bank technology officers may well conclude that they should deploy a mix of teller area and back office image capture devices, Jucht added.

Jucht made his remarks during a June 7 Webinar entitled “Perspectives on Branch Image Capture Strategy” sponsored by Alogent Corp., a developer of payments software in Alpharetta, Ga. Other panelists included Tom Malengo, a senior vice president with Cleveland-based KeyCorp and Steve Ledford, chief executive officer of Atlanta-based consultancy Global Concepts.

Bank retail customers typically present one or two checks at a time, which lends itself to capturing images in the teller area, according to the panelists. However, commercial customers generally present large numbers of checks, which makes back-office image more suitable, they said.

Jucht said front counter deployment likely provides bigger cost savings because it can eliminate most of the paperwork that tellers create, as well as reduce errors. The downside is that commercial customers presenting large numbers of checks can hold up the teller line, he said.

Either way, branch image capture lets most check processing get started earlier in the day, thus smoothing out demands for staffing, according to Ledford. Moreover, check truncation, which typically goes hand-in-hand with image capture, can eliminate or at least reduce courier costs and alleviate the need for maintenance and replacement of expensive check proof and sorting machines, he said.

Forecasting widespread industry adoption of branch image capture capabilities, Ledford said banks need to consider whether to undertake an enterprise-wide or more selective deployment. Deploying image capture throughout an organization can ensure consistency in customer experience and will improve the likelihood that tellers can move from office to office without requiring new training, he said.

On the other hand, selective deployment, focusing on offices where the business case is strongest, would probably produce a greater return on investment, Ledford said. If that's the choice, he suggested starting with geographically isolated branches and branches with expensive courier contracts.

Ledford added that the business case for imaging is stronger for branches that receive significant volumes of high-value non-local checks, where quick funds availability is especially important.

KeyCorp's Malengo said banks might want to wait on deposit imaging deployment until they need to upgrade or replace teller systems. Banks will also want to take stock of their own comfort with re-engineering item processing work flow before undertaking a big change, he added.

In the long run, the front-counter vs. back-office decision does not have to be either/or, the panelists agreed. They noted that banks can easily start with small back-office deployments and then move to a larger installation at teller counters as they gain confidence in the technology and the workflow that goes with it.

(For more on rewards programs, see "Making the Case for Remote Deposit Capture" in the May/June 2006 issue of BAI's Banking Strategies. Also see, "Image Capture 'Rolls Out' in Branches" in the October 11, 2006 issue of BAI's Banking Strategies Retail Delivery Insights and "Attorney Warns About Remote Deposit Capture Risk" in the May 24, 2006 issue.)

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