Image Volume Mounts Steadily for SVPCO As It Courts Smaller Banks

In a sign that check image exchange continues to make steady progress, SVPCO has reported its national network processed 56.5 million items in June, an 11.1% increase over May's volume. Total dollar volume for the month reached $157 billion, up 4% over May. Daily average items, a keenly watched indicator, hit 2.57 million, also up 11.1% over May. At the same time, the increasing readiness of banks to receive as well as transmit electronic check images was underscored by the network's addition of Huntington National Bank, which began receiving images June 23. Huntington came on board as a result of the network's so-called Gateway DTA product, which SVPCO says allows mid-volume institutions to participate cost-efficiently in image exchange. The Gateway DTA permits banks to link to SVPCO's Image Payments Network through a network gateway rather than through the bank-hosted DTA (distributed traffic agent) larger institutions maintain. The DTA software manages bank-to-bank image exchanges throughout the network, which does not rely on a central switch. SVPCO says the new gateway product, by chopping processing costs to participating banks, opens the network to institutions handling fewer than 100,000 daily items. “With greater access to the Image Payments Network, check image volume will continue to grow rapidly,” said George Thomas, executive vice president of The Clearing House Payments Co. LLC, SVPCO's New York-based parent company, in a statement. SVPCO says early in the third quarter it will begin allowing Internet links via the file-transfer protocol (FTP), which it expects will also open the system to banks handling smaller check volumes. With the addition of Huntington, the Image Payments Network now connects 14 banks for image exchange, including some of the biggest institutions in the country. The network also connects to the Federal Reserve's image exchange. Volume on the network, the nation's largest image-exchange system, has outstripped SVPCO's original projections (Digital Transactions News, May 10). At the same time, banks are trafficking an increasing load of smaller-value checks, after initially using the network to settle mostly commercial checks to gain the advantages of faster clearing times. The average item value in June was $2,793, down from $2,984 in May and from $7,949 a year ago. In image exchange, banks of first deposit send electronic images of checks, rather than the paper originals, through networks to receiving banks for settlement. In cases where banks aren't equipped to settle on images, the images are converted back into paper as so-called substitute checks, as provided in the Check Clearing Act for the 21st Century (Check 21), which took effect in October 2004.