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Imaging the Future

This November's gutsy alliance between two of the largest image exchange networks is just the kick in the rear the industry's fence-sitters needed to embrace Check 21. Endpoint Exchange, which is run by Milwaukee-based Metavante, and Viewpointe, a bank-owned venture, agreed to connect their networks so that banks on both systems can exchange check images with each other. Experts say 2006 will be the pivotal year for Check 21, and this agreement is a good start.

The partnership was a smart move by Metavante, says Mike Harris, VP with Atlanta-based consultancy Speer & Associates. "Viewpointe has been around for a while and they figured, Why reinvent the wheel? This is a good deal for all involved."

Bruce Cundiff, an analyst with Pleasanton, Calif.-based Javelin Strategy & Research, agrees that Metavante made a good decision. "This [deal] seems to be primarily an attempt to provide more-comprehensive coverage for check imaging," he says. For example, Endpoint customers now can avail themselves of Viewpointe's massive archiving system.

The agreement fills gaps in the check image exchange process since the networks cater to different clientele—Viewpointe is involved with the top-tier financial institutions, while Endpoint is engaged with mainly small to midsize institutions. Each network now has access to a wider array of banks.

Although the entities emphasize they are not competitors, according to Speer's Harris, Endpoint's smaller size could make it a takeover target by its larger partner. "I'm sure Viewpointe is not adverse to such a thing," he says. "If they want to gain market share, that's the way to go."

Javelin's Cundiff is more cautious, stating that the partnership is "only an integration of the two systems and networks." He adds, "The business should remain integral to Metavante, a fairly large organization in its own right." --M.B.

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