Cash Management & Banking Services

1. Cash Management & Banking Services Commonwealth of Virginia Remote Deposit Capture Program (RDC)

2. Objectives • Discuss Check 21 Legislation • Explain what Remote Deposit is, how it would be beneficial, and how to use it • Demonstrate

3. Current Deposit System Collect Checks Deposit check Record Receipt 9:00 a.m. 2:00 p.m. 12:00 p.m. Wait in line Travel to Bank

4. Check 21 Legislation • Check Clearing Act for the 21st Century (HB1474) passed in Oct 2003 • Permits the use of a substitute check as a legal document- ex: image of a check • 2 types of instruments are excluded: • Savings Bonds • Checks not drawn on a US Institution

5. Check 21 Legislation • Payments stay within check law • Applicable to all US$ denominated checks • No need to notify or get authorization from makers or paying banks

6. RDC- The Big Picture Collect Checks Scan checks Deposit Online 9:00 a.m. - 8:00 p.m.

7. Did You Know? • Deposit tickets are not needed with Remote Deposit Capture (RDC) • Agencies do not need to encode the dollar amount of the check • The bank can correct MICR misreads after they receive the transmission • Treasury pays all associated monthly fees (you only buy the scanner!)

8. Remote Deposit Capture (RDC)The Product Overview With a small desktop scanner, a PC, and an Internet connection, a customer can scan checks and transmit check images to the bank for deposit. Canon CR-25, NCR TS-230, Unisys SmartSource

9. Advantages • Deposits can be made until 8:00 p.m. and still count towards that day’s deposit • No geographic restrictions • No trips to bank branches or IP centers • No checks excluded (POP, ARC, Drop Box)

10. Advantages • No courier expenses related to check deposits • Improved availability from earlier deposits • Eliminate numerous bank depository accounts • A faster, automated deposit preparation process

11. Who can use RDC? Everyone! Typical customer has: • Large dollar check payments • Volumes ranging from a few important checks per day to 10,000 or more checks a month • Single site or multiple sites

12. Preparing Deposits Four Easy Steps: • Checks are scanned under software control • Corrects individual items that are not scanned correctly. • Deposits are balanced • Sends the deposit via secure Internet transmission

13. For Your Information • Agencies must still use their own endorsement stamp for checks • Agencies may make multiple deposit transmissions per day • With virtual sorter, images from customer transmissions will be sent directly to the image archive, where the agency may access and view images

14. Supported Desktop Scanners Features: • Front and back in a single pass • Reads MICR ink • USB connection to a PC MyVisionX

15. What kind of scanner should I use? • Low speed scanners are less than $1,000.00 (65 Documents per minute) • Higher speed scanners are available for those who deposit more than 500 checks per day • The bank endorses several models

16. System Requirements • High Speed Internet Connection • Minimum PC Requirements • Pentium 4:2.8 GHZ processor or higher • 256 MB RAM • 2 USB ports • Windows 2000

17. System Requirements • A bank certified scanner (low or high speed) • Printer Optional • Recommended to print reports

19. Do the checks need to be endorsed before they are scanned? Yes, all checks should be endorsed prior to scanning.

20. What do I do if I have a problem? Bank provides technical support

21. Should we place a heavy diagonal line across all scanned checks? It is not necessary. Be careful not to alter the check until you know a good image has been stored on the banking system and your internal system, if you are storing images on an in-house server.

22. What do we do with the checks after scanning? There is no hard fast answer. What you do with the checks depends on the needs of your agency operations… 

23. What do we do with the checks after scanning (cont’d)? How many checks do you process daily? Do you have a secure area to store the checks?  Our experience has found that most agencies using remote deposit keep the checks anywhere from ten days to six months before destroying. 

24. What do we do with the checks after scanning (cont’d)? Best practice would be to keep the checks a minimum of one recon cycle or at least 21 days from deposit.  This allows enough time for return items to surface and for the bank statement to be reconciled.

25. How do we dispose of the checks? Shred in a secured manner - in house or contract. Consider audit concerns such as dual control over shredding, logging when the checks were shredded or who did the shredding. 

26. Should check types/sizes be placed together? Yes, it helps identify problems if the business checks are placed back to back, then the personal checks and money orders. 

27. Should check types/sizes be placed together (cont’d)? Most users find it helpful to place money orders either first or last in the batch.  Money orders generally require manual intervention due to the placement of money amounts on the documents.

28. Will the scanner pick up pink or purple ink? Yes, the scanner will if the ink is dark enough.  As would be expected, checks with pictures and lightly colored ink can be challenging.  You may have to enter or verify the dollar amounts on these checks.

29. Does the scanner note differences in the written amount and the numerical amount? No, the scanner picks up the numerical symbols in the box on the right side of the check.  It is up to the person doing the deposit to verify the amounts are the same. 

30. Does the scanner note differences in the written amount and the numerical amount (cont’d)? Running two calculator tapes, one on numerical and one on written, is considered a best practice to identify these types of differences.

31. Demonstration

32. Testimonies “The Bank Services Unit at TAX began utilizing Wachovia's Remote Deposit Capture product in the Fall of 2007 to address a needed internal process in clearing small volume, but large dollar special handle deposits. This product has exceeded our needs:…” Larry Leach, Bank Services Supervisor, Department of Taxation

33. Testimonies • Deposits can be made on our time schedule to accommodate our work flow, not that of an internal or external courier that has to drive the deposits to the bank.  Larry Leach, Bank Services Supervisor, Department of Taxation

34. Testimonies •  Extended deposit window.  We can deposit large dollar checks received in the mail after 2:00 and get same day credit at the bank.   Larry Leach, Bank Services Supervisor, Department of Taxation

35. Testimonies • Ease of use.  A “non technical” person can quickly become a proficient user. •  DC numbers (or an internal reference number) can be used and transmitted. Larry Leach, Bank Services Supervisor, Department of Taxation

36. Testimonies • Software version of RDC allows some mobility in disaster recovery mode.  (TAX utilizes a dedicated lap top for processing.) Larry Leach, Bank Services Supervisor, Department of Taxation

37. Testimonies • Expandability.  TAX recently migrated one of our satellite offices to RDC processing, resulting in their funds getting to the bank sooner. Larry Leach, Bank Services Supervisor, Department of Taxation

38. Testimonies • The main surprise we have had is that we did not anticipate our volume of foreign/international checks--specifically Canadian checks.  RDC cannot process foreign checks. Larry Leach, Bank Services Supervisor, Department of Taxation

39. Testimonies “The Department of Education has been very pleased with the Remote Deposit System.” • We have found the system very user friendly and a definite benefit to our agency. Margaret Dowdy, Accounting Office VA Department of Education

40. Testimonies • Although the deposit procedure takes about thirty minutes longer to complete, the new process has cut our returned checks by 75 percent. Margaret Dowdy, Accounting Office VA Department of Education

41. Testimonies • This savings in accounts receivable collections far outweighs the extra process time and is definitely cost effective. Margaret Dowdy, Accounting Office VA Department of Education

42. Testimonies • Our COOP plan for deposits, if we could not access the building for a short period of time, would be to return to manual deposits. If the building was not accessible for a long period of time, we would request that a teller scanner be set up at our alternate location. Margaret Dowdy, Accounting Office VA Department of Education

43. Questions

44. Cash Management & Banking Services Commonwealth of Virginia E-Pay

45. E-PAY • Purpose: to deposit funds to the state from a localities checking account • It’s fast! • Can be completed from any PC • https://onlineepaymanager.suntrust.com/ebp9/Customers/Payment/SUNTRUST/common_va/default.aspx

46. Benefits • No Deposit Ticket • Save a trip to the bank • System available 24 / 7 • Entries and changes can be made up till 4:00 pm • Electronic Log of all transactions (12 months rolling history)

47. E-PAY Step One: Log In

48. E-PAY Step Two: Enter Payment Information

49. E-PAY Step Three: Review

50. E-PAY Step Four: Get Receipt