April 18, 2009

Bob Meara, Senior Analyst, Celent
Consumer RDC has seen rapid product evolution and increased adoption over the past year. More than a dozen vendor solutions are now available, up from just two in early 2008. The growth has come in response to consumer demand as well as realization by financial institutions (mostly credit unions thus far) that broad-based adoption of consumer capture can produce operationally satisfying results. Only a short while ago that would not have been the case.

Doing so requires a solution that is tightly integrated into online banking systems for user authentication and entitlements, and modern image-based item processing systems for deposit review and downstream processing. The newfound viability of consumer capture is a result of two developments:

1. Improved image analytics. Server-side "engines" take much of the work out of scanning deposits. Many solutions automatically de-skew and crop scanned checks while significantly improving the user experience. At the bank the images are more readily processed with fewer exceptions.

2. Use of existing scanners. Avoiding the purchase, storage, deployment and support of hardware radically changes the solution economics. Consumers seem to welcome the relatively slow scanning process as long as they have just a few checks to deposit. Higher-volume business users will want scanners designed specifically for checks.

Operational risks associated with consumer RDC have been manageable. Usage is typically limited to consumers with good deposit histories, and suitable deposit limits are placed on remotely deposited items. In some cases, funds availability is delayed to reduce risk.

Consumer RDC appears to be a win-win: Banks don't handle paper and consumers avoid trips to the branch.


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