Consumer Remote Deposit: It Doesn’t Cost, It Pays

George Dow
July 14, 2008 | COMMENTS

With a large number of members spread throughout the country—many with limited access to brick-and-mortar branches--$3.5-billion Digital Federal Credit Union, in Marlborough, Massachusetts, decided to implement a consumer remote check-capture service.

“This is a huge convenience to our members,” said Denise Gonthier, Digital's remittance processing manager. “It's a very easy way to deposit with us from home, from work or even when traveling—anywhere members have access to the Internet and a scanner.”

Digital Federal Credit Union is the fastest-growing credit union in the United States, and serves more than 344,000 members and their families in all 50 states and around the world. The credit union selected EasCorp's DeposZip™ program as its remote check-capture service, which it launched as “PC Deposit” in March. Since that time, the credit union has registered approximately 10,000 new users and processed more than $10 million in deposits.

“It's appealing to everyone,” said Gonthier. “We're seeing members who don't routinely deposit at DCU bringing their money to us now. It's possible that our shared branch or ATM was too far away from them to use us on a regular basis. But that's not the case anymore with PC Deposit. Our members love it.”

The implementation of PC Deposit also brought significant bottom-line cost savings to DCU, particularly among its members making shared-branching deposits. Compared to the cost of shared-branching deposits, the credit union saves on average $2.50 per transaction when members use PC Deposit.

Another area of savings: back-office operations time and expenses. “Here too, the convenience factor is huge for our back-office,” said Gonthier. “Everything is just a click away. No more searching and sorting through bundles of mail each day—the deposits are already online. Employees never have to leave their chairs.”

The software performs functions that traditionally fall to the back-office staff, such as encoding, preparing cash letters, and verifying totals. That frees up time for other activities. DCU also saves money by using fewer printed deposit envelopes and less pre-paid postage. In a typical year, the credit union spends $182,000 on the printing and postage costs of pre-paid envelopes; by shifting just 10 percent of this volume to PC Deposit, the savings would be more than $18,000 per year.

Here's how the program works: After accessing DCU's online banking system, members scan their checks and the deposit is submitted. EasCorp captures the data, performs image tests and securely displays the image to DCU, which verifies and then releases the deposit for collection. DCU offers the program free to qualified DCU consumer members, whose funds are credited the same business day when submitted by the standard processing time.

DCU's PC Deposit service eliminates the need for members to mail in checks, drive to an ATM or visit a shared-branch location to make a deposit. They simply sign, scan, and electronically transmit their checks for deposit from their home or office using their PC and almost any common desktop scanner.

PC Deposit works well for businesses, too, says Gonthier. “It's an easily scalable product for our business members—the main difference is using a high-speed duplex scanner to manage the higher volume of checks.”

DCU admits to having some concerns about the potential for fraud, but “we have yet to experience a single loss,” said Gonthier. “In terms of fraud, there's been nothing. Maybe a few returned items for insufficient funds, but these would have occurred under any circumstance.”

The program, developed by EasCorp's in-house technology staff, also includes many built-in security features, she said.

The success of DCU's PC Deposit—the ease of the implementation process, the positive member feedback, and the time and dollar savings—has the credit union fully committed to promoting this program. Both marketing and management are working on innovative ways to promote he service to more members.

“It's been tremendously successful in a short period of time,” said Gonthier. “It gives us a real competitive advantage.”

George Dow is assistance vice president of member relations and product development at EasCorp. Contact Dow at 800-428-1144.