"Lights Out" Exception Processing
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Overview: Imagine a totally automated payment-processing environment where fraudulent, duplicate, or erroneous items are corrected (or rejected) before posting. Imagine how happy your customers will be with the error reduction in such an environment. Imagine the costs that could be eliminated. Now compare this to the current system of reconciliation, where mistakes and fraud are detected after the fact, after the customer relationship has been tarnished and the institution is forced to write off unnecessary losses. Finally, imagine this problem being exacerbated by the rapid growth in image exchange. In the future, banks have two clear choices to make with regard to image exchange: 1) Adopt a more proactive process that identifies bad payments before they are posted, or 2) Prepare to deploy additional resources to the reconciliation, research, and correction of these payments as the level of bad items grows in tandem with the level of electronic postings. "'Lights Out' Exception Processing" addresses the first option. Financial institutions can meet this challenge proactively by moving a series of historically Day Two processes (regarding the second day that a payment is in the system) into Day One. These processes can identify payments that cannot or should not be posted or sent before the items post. This would save banks millions of dollars by eliminating reconciliation, research, adjustment, and fraud costs; and eliminate the unproductive use of capital in suspense accounts.