When the Check Clearing for the 21st Century Act (Check 21) became effective in 2004, it opened the door to innovative deposit processing. The legislation allows image replacement documents created from check images to carry the same standing as original paper checks, so deposits no longer need to physically be made at fi nancial institutions (FIs), and all deposits can be handled more effi ciently. Checks can be scanned and processed electronically, allowing checks to clear faster and reduce deposit-based fraud.
Since Check 21 took effect, deposit automation continues to advance on various levels. In the beginning, many deposit automation initiatives focused on back room processes or deposits performed in branches. Now, deposit automation-enabled ATMs can accept cash as well as single or multiple check deposits without the need for an envelope. Deposits can be sent electronically and received and processed from virtually anywhere. In fact, some technologies are already capturing check images at home or through mobile devices, such as cellular phones. According to a recent Retail Banking Research (RBR) study, deposit automation is one of the fastest growing new banking technologies because it offers the multiple conveniences and advanced functionality consumers want. RBR reported that the number of deposit-automated ATMs across 26 countries has more than quadrupled since 2003 to more than 96,000 at the end of 2007. The study predicts market demand will continue to grow to as many as 670,000 deposit-automated units deployed by 2018.