AVON, Conn. – COCC plans to pass the savings from Check 21 on to its processing clients by acting as an image-exchange broker, the company says. "Our strategy is to aggregate the outgoing check images, ship them electronically to the exchanges that offer the best funds availability and lowest processing costs, and pass the savings to our clients," says Joseph Lockwood, COCC's chief technology officer. "That will make Check 21 a win for the financial institution and the public," he says. The 110-client company says it already has inked pacts with the Endpoint Exchange Network and the National Clearing House and plans to secure more such alliances before Oct. 28, the day Check 21 takes effect. To help its client credit unions and community banks take advantage of the interim period between the current paper-processing system and full image exchange, COCC is banking on its strategy of linking its clients to those exchanges with custom software, Lockwood says. Such a hybrid system will help its clients reach the full utilization goal of a 50% reduction in check collection fees and an estimated 90% increase in next-day availability of funds, the COCC executive says. "The check processing industry won't switch everyone over to image on October 28," Lockwood says. "We're going to see paper and images for a long time, but hopefully a dramatic reduction in the paper." Lockwood says client-owned COCC, formerly Connecticut Online, has been an all-image shop since 1998 and is continuing to work to smooth check and image settlement, such as automated ways to communicate the changes to consumers, and branch image capture using devices that cost no more than a microfilm machine yet deliver efficient branch archiving and research capabilities, including at the tellers' screens and via Internet banking. "Image or not, we still need to monitor the items, balance, return, settle, archive, and report all checks – imaged or not – on behalf of our clients. The first major hurdle will be getting end users to feel comfortable with the new substitute checks that become legal equivalents of original checks on October 28," Lockwood says. "We are looking forward to that day as the date that paper checks truly begin to disappear. The `checkless society' is finally within our reach," he says. -

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