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Banks Checking Readiness for Check 21

A surprising number of issues are involved with preparing for Check 21.

In preparation for Check 21, banks are attending workshops to learn more about the requirements and the benefits of digital check imaging and exchange.

Huntington Bank (Columbus, Ohio, $30.5 billion in assets) is one of the banks that has recently participated in a Unisys (Blue Bell, Pa.) workshop for Check 21 readiness. The bank was surprised with the number of issues that had to be addressed, according to Ted Kute, senior vice president, operations services.

"We came up with over 100 different functions that we needed to look at," says Kute. Kute says the workshop also helped bank employees realize that the whole process involved them working together.

"There was a point in time when everyone participated and did a shared understanding of the way things are done today," says Kute. "Then there was a shared decision on how the new process should work and the opportunity for everyone to weigh in on it."

Unisys is among several companies that are helping banks with readiness assessment workshops, informing banks on what needs to be improved in order to take advantage of Check 21 successfully. Unisys' workshop is designed to guide banks in what their current systems are lacking and how to improve on what is deficient in the systems, according to Gary Cawthorne, managing partner, global banking practice, Unisys.

"We have been working with major banks within the U.S. and looking at what their business looks like today, what it will look like in a Check 21 world, how many gaps there are and what they will have to do with their business processes and systems in order to get ready for Check 21," says Cawthorne.

When Unisys did its first workshop, the technology solutions provider was overwhelmed with the amount of processes banks needed to change, according to Cawthorne. "The results have been very surprising," he says. "When we did the first [workshop], we and the bank went into it thinking there were a dozen or so different processes that will be affected. We saw anywhere from the high 40s to a hundred different processes or systems that would have to be evaluated or could change with the Check 21."

The provisions of Check 21, the "Check Clearing for the 21st Century Act," will become effective on October 28, 2004.

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