SVPCO Swaps More Images in First Quarter Than in All of 2005

The country's largest image-exchange network reported today it handled more volume in the year's first quarter than it processed in all of 2005, while traffic reached new heights in March. Average daily volume at SVPCO's Image Payments Network, which links a dozen banks as well as the Federal Reserve for the swapping of electronic check images, hit 1.27 million items last month, up 24.2% from February. The daily average dollar value of these items was $4.66 billion. Volume for the first quarter amounted to 62.5 million items. The network handled 52 million items in all of 2005. Total volume for the month was 29.2 million, up by 50.3% over February, while total dollars reached $107.2 billion, a 44% surge from February. Indeed, on current trends, SVPCO officials predict monthly volume will double by year's end. “We expect the current growth rates to continue and anticipate the total number of check images to surpass 60 million a month by the end of 2006,” said George Thomas, executive vice president at The Clearing House Payments Co. LLC, in a statement. The Clearing House, New York, is SVPCO's parent company. In the continuation of another trend, the average value of each check image declined in March, to $3,664. The average check value in February was $3,835, and fully $5,919 in January. This could indicate the network is handling a greater share of consumer checks. Initially, banks tended to send commercial checks through the network in an effort to take advantage of image exchange's faster clearing times on these high-value items. SVPCO's network is just over a year old as a commercially available service. 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, or image-replacement documents (IRDs), as provided in the Check Clearing Act for the 21st Century (Check 21), which took effect in October 2004. IRDs have long been seen by experts as dominating image exchange, but SVPCO reported in February that the volume of images flowing through its network with IRD instructions had fallen to 20% of total traffic.