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Value added services with CTS

Value added services with CTS

  • Integrating the image archive to interface with the Internet banking application can allow the retail customers of the Bank to view their paid cheques over the Web and print the same for their records. This provides the bank with an opportunity to generate additional revenue by charging a fee to the customers availing this service.
  • The Banks’ can install a cheque deposit kiosk which can provide the customer with a receipt containing both the image of the cheque deposited as well as the details entered by the customer on the cheque.
  • The above value added service can also be thought of being provided through the ATM.
  • The Bank can also have an interface with the SMS service of the cellular phone providers. Using this service the bank can automatically send SMS messages to their customers advising them of cheques being identified for return in the day’s clearing. This service can be provided in a real-time scenario and would ensure that lesser cheques are returned via clearing.
  • The other benefit can be that the Bank can increase the time for the cheque collection process as the activities of cheque truncation and imaging will take much lesser time than manual process. This would facilitate sending the cheques deposited for clearing even after the stipulated time.

More on issues that has to be taken care of before CTS

Shared Services

There is no necessity for all banks to make huge investment in the technology and hardware procurement. Infrastructure can be shared either between banks or through independent service providers.

Banks like State Bank of India and Punjab National Bank have already invested a lot in the resources and technology required for Cheque Truncation. Hence, the other Banks can form a consortium with them by which they can avail services like:-

  • Imaging of Cheques which can be sent by the service branch of one Bank to the Image Processing Center of either SBI or PNB.
  • Transmitting images to clearing house where the other Banks would be utilizing the networking capabilities of these two Banks.
  • After clearing, these images can be returned to the service branches of the respective banks’ in diskettes or CD.
  • One of these two Banks can act as a Centralized Warehouse in a certain region to store the cheque images for the other Banks.

All these services and more can be provided by them for a charge as negotiated between them and the other Banks.

Bandwidth

Depending on the maximum cheque data and the image volumes to be transmitted, the bandwidth has to be calculated. The images do not take much of the Bandwidth but, the network may get congested if a lot of packets are sent at the same time. Hence network management is an extremely important issue to look at.

If images are sent batch wise then it may create bandwidth problem depending on the transmitting capacity of the Leased Line or the dial-up. A minimum of 2 Mbps (or more) line will be required to overcome congestion in the network. But, the thing to notice is that this connection would just be used once a day during batch upload and other than that the capacity will just go waste. The Banks can go in for this option provided they can effectively utilize the bandwidth available during lean hours.

A wiser option would be to go for an independent 64 kbps (or more) leased line between the service branch and the MICR Center to continuously send the data and image as and when they are scanned and the required details fed. This option would effectively utilize the bandwidth available during the working hours plus it would be easy on the pocket.

Cheque Imaging

Instead of the JPEG and GIF format for storing images as was originally thought, another option for the service branch of the presenting bank could be to save the scanned cheque images in the TIFF format and then FTP them to the Clearing House. This is because, images in TIFF format occupies very less space.  As the images go from Clearing House to the Paying Bank the TIFF files can be reconverted into gray scale enhanced JPEG images.

Grey Scale vs. Black & White Scanning

The Working group on cheque truncation has suggested grey scale scanning for the images. The clarity would definitely be better in case of grey scale but the option of black & white scanning should also be pondered upon as it would save cost due to Lower storage space requirement and bandwidth consumption. Therefore, for cheques below a certain amount, the usage of black and white scanning can be looked into by the Banks.

Storage

RBI has suggested that there should be a single agency or a bank which can look after the storing of the cheque images. Apart from that, the respective banks should also preserve the cheque images and store them in their service branch. These digital images can be sorted and also indexed by account number, cheque number, date, customer name or any other business criteria for their easy retrieval, if the need arises.