Legacy systems can be a problem across the board in the payments industry, and corporate deposits are no different. Many of the remote deposit capture (RDC) systems in place today have been around for 15 years or longer.
Dave Wilson, Founder and Chief Architect at DadeSystems, says even if these RDC systems are still technically functional, they offer diminishing returns as the other systems they must interface with become increasingly advanced. New and old systems are crossing signals, making what is already a time-consuming and labor-intensive deposit process even more of a hassle.
With legacy RDC, commercial bank customers would be provided with a scanner to keep in their back office, which employees could use to scan deposits throughout the day. Wilson said that was a decent first stab at automating the commercial customer, but today, it doesn’t do enough.
When a company receives a payment from its customer, there are two main accounting functions that must take place, Wilson said. First, funds must be credited to the company’s account. Second, the payment must be logged so that open invoices can be closed out. The RDC station only solved the first part of that problem. Automation, according to Wilson, could solve the whole problem in one go, posting the deposit to accounts receivable as soon as it’s completed.
Another challenge of the legacy RDC is handling distributed collection of payments. When field representatives are out doing sales and collecting payments, Wilson said that can be a recipe for problems. Checks can be lost, misplaced, or simply deposited late. And if the rep doesn’t have access to an RDC station, they are likely depositing those checks into a local bank account, which the larger company must then reconcile with various other accounts and move funds into the central account.
Wilson said this is why DadeSystems wanted to create a mobile tool for sales reps and other remote workers to use in the field — say, a food distribution company that delivers products to different restaurants, which picks up payments at the time of delivery. With a mobile tool, companies gain the advantage of getting checks into the system as soon as they are received, eliminating the issue of lost payments — and the consolidated payment is sent along to the central office automatically, eliminating the issue of checks not getting posted to accounts receivable.
“When it comes to actually getting the deposit where it’s going,” said Wilson, “a machine can do it more accurately, and in a more timely manner.”