Payment innovations: new tools become mainstream

Just a little over three years since Check 21 became effective, payment processing engineering continues to progress, while credence grows. Consider that as of Oct 2007, about 12.2 one million million checks per year were being cleared via an image-based process, study checkimagecentral.org. This represents about 40 percentage of all bank check, the site said.

Financial executives with companies of all sizes are becoming more comfortable with tools such as check scanners and recognizing the benefits they offer, says Craig Vaream, vice president and ACH and global check sedimentation product executive director with JPMorgan Chase. "The acceptance of this engineering makes our clients' lives easier."

As a consequence, banks continue to introduce new scheme to help their corporate clients procedure payments more expeditiously and accurately. Equally important, given that most companies' customers use a range of payment methods, these solutions can expeditiously handle various payment types.

Deutsche Bank, for case, has introduced "moral force Payment direction," says Harold Young, head of payments with global transaction banking. Treasurers can tell the bank when to issue different payments. A payment can be set for a particular time, which can be critical during a amalgamation or acquisition or dividend payment. Or, it can be conditional on some event, such as an business relationship having reached a certain balance.

At the same time, treasurers obtain 24/7 visibleness into their payments queue. "In a real time settlement world, you need to manage cash flows intraday to maximize treasury efficiencies," Young says. This visibleness also allows treasurers and cash managers to grip more question and probe of payment questions themselves. By moving to a self-service investigation model, the norm length of time required to resoluteness questions has dropped from about 4 hours to 11 min, Young notes.