It takes only a moment to write a cheque, yet the delivery, processing, and secure storage of the cheque is a costly and time consuming process for credit unions and financial institutions
While we are still many years away from the elimination of cheques as a payment instrument, changes to the Canadian Payments Association (CPA) rules have opened the doors to more cost efficient methods of cheque handling. Under the revised rules, electronic images of cheques can be "treated as an official image and used for all purposes as though it were the eligible bill". Thus, with the digital storage of cheque images, the need to store paper cheques securely for up to seven years is removed.
Central 1 has been providing a storage and destruction solution for cleared BC credit union cheques since February 2011. This service will also be available to Ontario clients in April 2012.
With this service, credit unions no longer need to courier cleared cheques from Central 1 to a third-party for long-term storage and destruction. All cheque handling and destruction is executed at Central 1, which eliminates, or heavily reduces, the associated costs, including:
The cheque storage and destruction solution also offers easy retrieval of cheque images through Central 1's Online Return System (ORS).
With ORS, clients can easily view images of cleared cheques that date back up to seven years. With the changes to the CPA rules, cheque images printed by the credit union using ORS can be used in place of the cleared physical cheques in any legal capacity, including in court cases.
Doug Pearson, Product Manager, Cheque Clearing, at Central 1 says that beyond the immediate cost reductions and more efficient processes for clients, the service also offers added security measures. "Because the physical cheques remain on site and in Central 1's custody until destroyed, there are fewer hands touching the cheques, making the process more secure and reducing privacy concerns. It also reduces the opportunity for error by minimizing the number of times a cheque is handled before destruction," says Pearson.
For more information please contact:
Doug Pearson
Product Manager, Cheque Clearing
Central 1
dpearson@central1.com
604.737.5046
Central 1 Technology and Payment Services