Check Image Exchange: Roads to Rome

January 17, 2006


San Francisco, CA, USA January 17, 2006

An Analysis of Factors Paving the Way

2006 will be a breakthrough year for image exchange/share. Celent expects the percentage of checks that are sent and received electronically will reach 18% in 2006 and grow to 56% by 2007.

Just like Rome, check image exchange/share is not being built in a day. The cornerstones falling into place today are the result of enormous effort. In the report, , Celent analyzes the drivers of this new check image empire.

The majority of banks have not started down the road to image exchange/share for cost-related reasons. But several factors will lead them to beat a path. They will hit several roadblocks if they stick with paper processing: unsustainable rising costs -- particularly from rising costs of air transportation and the eventual need to refresh their check processing technology. They will find some major cost benefits from moving to image-based processing, largely driven by the network effect, increasingly visible across image exchange/ share infrastructures. Moreover, any investment in check image processing today will pay off because the check will be around for at least another decade. Celent estimates that in 2010, there will still be around 19 billion checks being processed.

"The biggest cost specter over banks sticking with paper check processing is in air transportation. As top tier banks pull volume out of the transportation network over the next 12 to 18 months, costs will rise sharply. Red flags have already been raised," says Alenka Grealish, author of the report and manager of the banking group at Celent. "Regardless of how a bank is processing checks today, it will end up clearing and settling the majority of its checks via image exchange/share. By 2010, nearly 90% of transit items will be electronically cleared and settled," she adds.

This report profiles five important architects in the building of the check image Rome: Endpoint Exchange, the Federal Reserve, Fiserv, SVPCo, and Viewpointe.

The report is 29 pages, and contains 17 figures and 5 tables.

A table of contents is available online.


Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

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Table of Contents

San Francisco, CA, USA January 17, 2006

An Analysis of Factors Paving the Way


Executive Summary 3
From Whence We Came 5
Rationale To Pave The Way 7
  The Decline is Clear, But The End is Not 8
  Reducing Touch Points 9
Drivers To Move Faster 10
  Maximizing ROI Sooner 10
  Air Transportation Cost to Skyrocket 11
  Rising Rate Environment 12
Building Rome 13
  Image Exchange/Share Infrastructure 13
  Endpoint Exchange 14
  Federal Reserve 16
  Fiserv 17
  SVPCo 19
  Viewpointe 20
Future of Rome 22
  Coexistence of Paper and Image 22
  Interoperability Key to Realizing Metcalfe's Law 23
  Growth Spurt in Image Exchange/Share 25
  Latecomers Will Arrive 27

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