Viewpointe, a leading provider of check image exchange and archive services, today announced the launch of an enhanced Automated Settlement Entry (ASE) service.
This service is designed to allow financial institutions to designate specific settlement windows for cash letters in the check settlement process. With ASE, financial institutions can better control settlement according to their partner-established business agreements and deadlines, helping to reduce the risk of expensive settlement errors and reversals.
In addition, as more financial institutions have started including high- value, time-critical controlled disbursement account (CDA) payment traffic with their normal check image exchange traffic, the need to meet strict settlement deadlines has increased. ASE helps automate the business rules guiding settlement of CDA traffic and help avoid costly payment reversals resulting from missed deadlines.
ASE now allows financial institutions to present and settle payments for check image exchange participants based on firm timelines agreed upon with their partner financial institutions. Without use of ASE in the process, there would be standard deadlines collectively agreed to by the exchange members as a whole.
"By giving financial institutions more control in the settlement process, Viewpointe is helping to make the process easier, more efficient and less costly," said corporate spokesperson Diane Scott, president, Viewpointe Emerging Business. "We've studied this challenge thoroughly and have created a path toward a cleaner settlement process from which our customers can benefit."
Prior to transacting, one financial institution enters into a partnership agreement with another, often establishing agreed upon business rules for settlement of payments with its partner. Using ASE, a financial institution can provide those agreed upon business rules to Viewpointe. After setup of the ASE service, cash letters are delivered to Viewpointe through normal processing. Viewpointe will cross-reference the cash letters against the institution's pre-defined business rules to identify when the settlement should happen and posts the settlement entry automatically. If presentment occurs before the established deadline, then settlement processes normally - typically in that day's exchange window. If presentment occurs after the established deadline, then settlement is deferred - typically in the following business day's exchange window.
"More financial institutions are enforcing deadlines for actual presentment," said Scott. "If a collecting bank misses the presentment deadline but continues to submit the settlement entry, then the paying bank may refuse payment and ask for submission to the next settlement window. A paying institution may also inadvertently settle transactions when the presentment deadline was missed. This can/may require the collecting bank to make wire transfers to back out the settlement, which is disruptive, costly and time consuming. This enhancement to ASE addresses this problem."
To leverage ASE's benefits, financial institutions must be customers of Viewpointe's clearing and settlement services. ASE is Viewpointe's first product enhancement announced since acquiring the former PaymentsNation business and integrating it into a business unit focused on clearing, settlement and association services. This newly enhanced solution was developed based on the end-to-end clearing and settlement needs of financial institutions, and is a demonstration of Viewpointe's commitment to enhancing services based on the industry's current and future needs.