Unisys will design and help implement a new electronic cheque and image processing system for the Federal Reserve Bank of Cleveland, acting on behalf of the 12 Federal Reserve Banks.
The Federal Reserve Banks are replacing their existing system with a solution based on Unisys' Open Payments Platform, which uses components from Clear2Pay and Oracle, is based on a service-oriented architecture and Linux, and supports the Business Process Engineering Language (BPEL) standard.
The 12 Reserve Banks together are one of the United States' largest processors of payments, including paper and electronic cheques, for financial institutions.
Under this consulting, software and hardware agreement, Unisys will help the banks transition from their existing system to a solution capable of handling rapidly growing volumes of electronic cheques and images.
According to a recent Federal Reserve/ECCHO workgroup, just 29 months after the effective date of the Check 21 regulation, 7 billion cheque payments totalling $9.4 trillion per year have already moved from the traditional paper-based clearing process to improved image-based processes. Based on the 2004 Federal Reserve Payments Study, that amount is more than four times greater than the sum of all debit card payments ($.6 trillion) and all credit card payments ($1.7 trillion).
On an average day during March 2007, almost 6,800 institutions received 17.9 million cheque images for posting. These total 4.5 billion checks per year.
Danielle D'Angelo at Unisys says the Federal Reserve banks wanted to replace their first generation cheque imaging system to cope with the growing volumes and support their ongoing strategy to centralise their payments processing infrastructure and make it more efficient.
Unisys signed the deals with the Federal Reserve Bank of Cleveland last week, and expects to complete the implementation in the second half of 2008.
"We are committed to building a payment processing solution that effectively addresses the migration of financial institutions to electronic cheques and images, and we believe that the approach we are taking through this contract with Unisys will help us achieve that objective," said Pat Barron, retail payments product director, Federal Reserve System, and first vice president and chief operating officer, Federal Reserve Bank of Atlanta.
"This engagement with the Federal Reserve Banks continues a long tradition of partnering on payments innovation," said Curt Girod, president of Global Financial Services at Unisys. "In this new project, Unisys will help the Reserve Banks harness the power of open source technology for electronic cheque payments in a way that is efficient, grows to adapt with their business and addresses their customers' evolving needs."