Tuesday, September 8, 2009

The Surge in Interest for Remote Cash Capture

Posted by Mark Brousseau

Remote Cash Capture (RCC), the deployment of secure smart safes at merchant locations coupled with information reporting and provisional credit mechanisms, has been utilized in the United States for nearly 15 years as a means of improving merchant cash cycle control. Since 2004, when banks began offering provisional credit based on validated currency residing at the merchant location, the industry has witnessed a surge in interest and adoption of these devices.

The research paper “Remote Cash Capture—An Idea Whose Time Has Come,” authored and published by the international research and consulting firm Celent, thoroughly addresses this surge in RCC popularity with extensive research into remote cash capture demand, adoption, management, merchant cash logistics and potential benefits for both institutions and merchants.

According to the paper, the primary benefit of RCC provisional credit is that it facilitates wholesale reengineering of the cash cycle within merchants and between merchants, armored couriers and bank cash vault networks. RCC removes the substantial burden of cash handling typically carried by bank branch personnel historically, largely without the assistance of meaningful automation. In short, the paper states that RCC is a win-win-win wherever the merchant business case warrants.

RCC adoption however, has been slowed by both economic and systemic barriers. Armored courier systems are proprietary, meaning safes and information systems from different couriers do not communicate. This complicates adoption from interested financial institutions, which must invest in systems integration file validation and testing efforts just to participate. In addition, RCC is expensive, as both hardware and processing fees can make the solution unaffordable for a large number of otherwise interested merchants.

Celent predicts that economies of scale could eventually make the technology more affordable. For the foreseeable future, however, RCC will continue to appeal to a minority of merchants and be supported by a minority of midsized to large U.S. banks. As self-service applications continue to proliferate, banks will seek to participate with same-day provisional credit as is now being done with cash acceptor safes. Taking the form of self-service retail checkout and bill payment kiosks, these devices will further extend the reach of closed-loop cash cycle automation systems.

Hoping to take advntage of remote cash capture trends, Fiserv provides an integrated set of software solutions and industry-leading expertise to address the cash management challenges facing financial institutions, retailers and key service providers for these organizations.

CorPoint from Fiserv delivers cash order and deposit management with comprehensive tracking and service level management, all with a focus on expedited credit to retail customer accounts. Corpoint is designed to allow the bank to allow its corporate/retail customers to order and track cash orders and deposits via a bank-branded web portal or IVRU. This brings back the relationship that is sometimes disintermediated by the customer’s armored courier.

As a part of the Cash and Logistics suite from Fiserv, CorPoint:

... Supports any organization that accepts cash deposits from its customer base
... Supports any cash deposit mechanism including manual deposits or self-service cash devices such as Retail Recyclers
... Tracks retail customer deposits from source to destination
... Facilitates expedited customer deposit credit and deposit adjustments with single deposit process and data flow
... Eliminates geographic obstacles as banks pursue new deposit business outside of the current footprint

iCom from Fiserv offers cash supply chain management addressing cash requirements across the organization. iCom helps organizations achieve minimized cash holdings and reduced transportation expenses, with maximized availability of cash for customers.

As the cornerstone solution in the Cash and Logistics suite, iCom:

... Supports any organization with a cash supply chain, including financial institutions, retail organizations, ISOs and armored car couriers
... Supports any cash-point type: ATMs, branches, stores, vaults, third-party cash storage facilities and self-service cash devices
... Combines complex forecasting functionality with historical trends and known events to optimize cash holdings for the unique demands of each cash point
... Delivers accuracy in forecasting that allows organizations to optimize cash levels to avoid cash outages and eliminates excess cash holdings
... Enables management from one to thousands of cash-points supporting future additions obtained through mergers, acquisitions or organic growth

How is your organization handling remote cash capture? Post your comment below.


Anonymous said...
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John Angove, Chief Cash Advocate said...

RCC will become increasingly popular as paper checks continue to diminish in quantity, but more importantly as contactless payments are adopted by QSRs and c-stores. RCC allows depositors the freedom to completely re-engineer their approach to moving cash from the POS, to their treasury bank account.