Slowing Check Volumes Spur Consolidation

As check volumes decline, U.S. banks are increasingly looking to outsourced solutions to control costs.

One such solution is Symcor, founded by minority shareholders Royal Bank of Canada, Bank of Montreal and TD Bank. The utility processes about two-thirds of checks in the Canadian marketplace.

The switch to an outsourced check utility has allowed participating banks to switch their fixed overhead costs to per-item variable costs. As a result, the industry has been able to eliminate excess item processing capacity. "We have consolidated 23 sites in Canada essentially down to six sites," said Paul Currie, CEO of Toronto-based Symcor.

Check processing centers in the U.S. are ripe for consolidation, according to Currie.

"The check decline is now being experienced in the U.S.," he said. "The large financial institutions in the U.S. will turn to focused companies-check utilities-that can process checks safely and securely on a scale basis, using image."

Symcor provides online check images using IBM's OnDemand archive, the same platform used by Viewpointe Archive Services, a joint venture of JP Morgan Chase, Bank of America, SunTrust Banks, U.S. Bancorp and IBM.