Remittance Processing: It's Everywhere You Want it to Be

Today, Dec 2004 by Bolita, Dan

The dramatic changes in the way payments are handled, or more accurately, the dramatic way in which payments can be handled, has dominated industry news. Between Internetenabling that allows payments to be made on-line, to the new ways checks can be processed thanks to ARC and Check-21, a lot of organizations are now taking a closer look at how payments are made, and how they are processed.

These changes are highlighted in the following essays. While each stresses a different aspect of the changing business models, there is a unified theme. Not only is the method of remittance processing changing, but the location is as well. Whether outsourced or keyed remotely, where the processing occurs is just as flexible as how it occurs.

As Bob Kirk of Vicor points out, (pages 4-5), remote keying has solved "the chicken-andegg problem of aligning lockbox services with available operators and infrastructure." Bringing the work to the workers, instead of the other way around.

Remote keying is consistent with the changes in the data capture industry. By distributing key entry, a number of processing issues can be resolved - disaster recovery, work distribution in peaks and valleys - with the ability to scan locally and key remotely. "Remote data entry operators work as if they are sitting in the production site," Kirk advises.

Imaging technology not only allows an organization to distribute its most costly processing function - manual data entry - it also offers the choice to outsource it completely. An ASP (Application Service Provider) can assume some, or all, of the duties of a lockbox service.

In their essay (pages 6-7), Michael Radford and Les Lorenzo of ASF, which provides an ASP-based lockbox solution, offer compelling support for the advantage of an ASR "(Suppose) your operation has two processing centers, one in San Diego and one in Birmingham....the operators in San Diego can assist the Birmingham site with keying and balancing over secure, encrypted communication lines in order to meet deadlines." The ability to load balance remotely is just one advantage of an ASP-based solution.

An often overlooked benefit of outsourcing data capture is the opportunity it presents to reengineer the various data workflows. By recognizing that some functions are better delegated to a service bureau, organizations are forced to take a hard look at all their processes, which gives a chance to improve them. Taking the opportunity to assess best practices in remittance processing shares the benefit with the entire organization. By coordinating the capture processes of each department, holistic solutions emerge.

"Too many companies put aside or ignore the documents that may accompany a check, until there is a problem," explains Marc Haskelson of Communications Data Services (see page 3). Others have been steadily increasing their efforts to leverage all the information that comes into their lockbox."

Leveraging information that comes into an organization is the cornerstone of process improvement. The flexibility available to payment processing extends throughout an organization's information assets. The new business models and strategies for processing payments offer a unique chance to reinvent not only the remittance processing system, but all information handling systems across an enterprise.

Whether improving customer service by responding more quickly to customer requests, or improving data entry accuracy by cross-referencing databases, information shared across an enterprise becomes more valuable. Thanks to the changes in networked systems, the location of that information no longer need be a factor in how it is processed.

Dan Bolita is editor of TODAY Magazine, the Journal of Work Process Improvement. He has covered the document automation industry for more than ten years. He can be reached at 207-832-6638 or via e-mail at dbolita@tawpi.org.