preparing for check-21 icba san diego fred herr senior vice president retail payments office federal...
TRANSCRIPT
![Page 1: Preparing for Check-21 ICBA San Diego Fred Herr Senior Vice President Retail Payments Office Federal Reserve System](https://reader036.vdocuments.site/reader036/viewer/2022070401/56649f1e5503460f94c35e3c/html5/thumbnails/1.jpg)
Preparing for Check-21ICBA San DiegoFred HerrSenior Vice PresidentRetail Payments OfficeFederal Reserve System
![Page 2: Preparing for Check-21 ICBA San Diego Fred Herr Senior Vice President Retail Payments Office Federal Reserve System](https://reader036.vdocuments.site/reader036/viewer/2022070401/56649f1e5503460f94c35e3c/html5/thumbnails/2.jpg)
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Love & Hate
![Page 3: Preparing for Check-21 ICBA San Diego Fred Herr Senior Vice President Retail Payments Office Federal Reserve System](https://reader036.vdocuments.site/reader036/viewer/2022070401/56649f1e5503460f94c35e3c/html5/thumbnails/3.jpg)
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Love
![Page 4: Preparing for Check-21 ICBA San Diego Fred Herr Senior Vice President Retail Payments Office Federal Reserve System](https://reader036.vdocuments.site/reader036/viewer/2022070401/56649f1e5503460f94c35e3c/html5/thumbnails/4.jpg)
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Hate
![Page 5: Preparing for Check-21 ICBA San Diego Fred Herr Senior Vice President Retail Payments Office Federal Reserve System](https://reader036.vdocuments.site/reader036/viewer/2022070401/56649f1e5503460f94c35e3c/html5/thumbnails/5.jpg)
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Entering a period of changePain & Opportunity & Nostalgia
![Page 6: Preparing for Check-21 ICBA San Diego Fred Herr Senior Vice President Retail Payments Office Federal Reserve System](https://reader036.vdocuments.site/reader036/viewer/2022070401/56649f1e5503460f94c35e3c/html5/thumbnails/6.jpg)
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Entering a period of changePain & Opportunity & Nostalgia
![Page 7: Preparing for Check-21 ICBA San Diego Fred Herr Senior Vice President Retail Payments Office Federal Reserve System](https://reader036.vdocuments.site/reader036/viewer/2022070401/56649f1e5503460f94c35e3c/html5/thumbnails/7.jpg)
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Check-21 & wishful thinking
– Check-21 was written inside the beltway
– Check-21 is supposed to:– make the world a
better place– reduce check
processing & transport cost
– reduce check writing– Wishful thinking won’t
change the fundamentals
![Page 8: Preparing for Check-21 ICBA San Diego Fred Herr Senior Vice President Retail Payments Office Federal Reserve System](https://reader036.vdocuments.site/reader036/viewer/2022070401/56649f1e5503460f94c35e3c/html5/thumbnails/8.jpg)
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Check-21 & the bottom-line
– Will Check-21:– reduce my operating costs?– reduce fees I pay?– reduce my collection float?– reduce my fraud losses?– retain good customers?– attract new customers?– generate new fees & Net-
Interest-Margin?– make me more competitive?
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Number of non-cash retail payments in the US, 1978-2000 (billions)
Check writing has started to decline
0
10
20
30
40
50
60
70
80
1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000
Check Debit Credit ACH
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10Assume 5% annual decline in checks, 12 billion ACH/substitute check conversions in 2010
Hypothetical forecast of the future2002 - 2010
0
10
20
30
40
50
2002 2003 2004 2005 2006 2007 2008 2009 2010
Originals Converted
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Federal Reserve product offerings
– Proof & transit– Image cashletter collection services– Physical cashletter conversion services– Substitute check production & delivery– Physical transit cashletter collection services
– Outbound returns– Image cashletter collection services– Derived returns from FedImage archive– Substitute check production & delivery– Physical return cashletter collection services
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Federal Reserve product offerings
– On-us processing– Image cashletter presentment– MICR presentment with image-to-follow– FedImage truncation service– Physical delivery of originals & substitute checks
– Inbound returns– Image cashletter presentment– Substitute check production– Physical delivery of originals & substitute checks