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Develop an image strategy.
Because the decision on whether or not to proceed with image exchange can have far-reaching implications on a financial institution’s competitive positioning, the business case that’s developed must go beyond technological considerations. The impact on the organization as a whole — and how image exchange aligns with corporate strategy — must be considered. An effective business case should answer questions such as: What are our business objectives for image exchange?; How will image exchange support our corporate objectives?; How will image exchange save costs?; What revenue-generating opportunities will it provide?; and How will our business be affected if we choose not to implement image exchange now?
Image-enable check-processing operations.
For most financial institutions that are considering image exchange, this step is a fait accompli. Any institutions that have not yet become image-enabled must first decide if they are going to do image capture in-house or outsource that function to a third-party service provider. Financial institutions that decide to do image capture in-house must first install up-to-date cameras on their capture equipment. Using those cameras to image checks, their processing system must then be able to create a file with MICR information and other needed data in the standard X9.37 file format for transmission. Financial institutions should keep in mind that, while the ideal scenario is to image-enable Day 2 processes, Day 2 enablement is not mandatory for exchanging images.
The financial institution implementing image exchange must be committed to eventually taking the paper out of its check process. With this goal in mind, the institution must plan when and how each aspect of the check process — from capture through returns, exceptions, and adjustments — will be image-enabled. It’s important to keep in mind that this does not have to be done all at once. For instance, depending on available resources, a financial institution may first image-enable its send volume and later phase in receipt volume. The ultimate goal, however, is to ready for image exchange any area that touches the check.
Create a cross-functional project team.
The financial institution should choose a project manager who knows the image exchange process and technology — in short, a subject-matter expert on image exchange — and then pull together a crossfunctional team. The team should include the institution’s operations manager for the item-processing function, an expert in connectivity and someone with the technological expertise to configure the vendor software. The same team should work on future implementations with other exchange partners to ensure an efficient process, although the team can be streamlined as its members become better versed in the various functional areas involved in implementation. Subsequent implementations, therefore, will require less investment in human resources than the initial implementation does.
Make any necessary workflow changes to accommodate image exchange.
Such steps might include adding duplicate detection for image replacement documents (IRDs) and images, implementing image statements, and enhancing your fraud detection systems to review images with fraud filters.
Choose a channel that allows the institution to exchange with a full range of partners through a single connection.
Implementing a single, robust connection is easier than managing multiple, individual connections to banks and/or other service providers. Networks such as those operated by Viewpointe, the Federal Reserve, SVPCo, and Endpoint Exchange provide one-to-many connections quickly and efficiently so that financial institutions can exchange images with financial institutions of all sizes and locations. Many financial institutions already have a plug-in, universal application for image transmittal from multiple capture sites to a main processing site. Financial institutions with such a solution can most likely use it for image exchange. In such cases, image exchange implementation generally can be completed in as little as four to six weeks.
Outline key processing procedures with exchange partner(s).
Partner banks must work out rules and procedures for all aspects of the check process.
Prepare and train staff.
Financial institutions implementing image exchange should explain why the change is being made and assure personnel that the work will be different but not harder. Above all, staff should be trained in the simplest ways possible to handle the new workflow and associated tasks. Even if an institution has a strategic plan for image exchange in place, that plan can get compromised if those who are actually administering image capture and exchange are not trained and continually brought up to speed on the equipment and processes.
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