Check/Check 21 Services

Abacus views earlier returns, delivered electronically, as a win-win

March 2010

Abacus Federal Savings Bank (Off-site Link), a $280 million bank headquartered in New York, New York, believes in staying ahead of the competition and adapting to the ever changing processes in the payments business. “Electronic receipt of returns is a chance to mitigate risk exposure. If we can minimize our vulnerability to physical transportation risk caused by bad weather, natural disasters or rising transportation costs at the same time, so much the better,” states Abacus president and CEO Jill Sung.

Founded in 1984, Abacus Federal Savings Bank’s original purpose was to provide banking services to immigrants and local residents of lower Manhattan. As the Chinese immigrant population grew throughout the 1980s and 1990s, the bank retained its original mission while expanding to six branches in New York, New Jersey and Pennsylvania.

Business challenge

Abacus began using our Check 21-enabled product suite in early 2007 when it implemented the FedReceipt^® Plus and FedReturn^® Services. The bank quickly implemented the FedForward^® Service in June 2007, then adopted the FedReceipt Plus for Returns Service in September 2009 shortly after it became available. “We were anxious to implement the FedReceipt Plus for Returns Service, as we saw the opportunity to further mitigate risk by receiving our return items electronically at the start of the day, rather than waiting for delivery of them by messenger in the early afternoon,” reported assistant vice president Edward Cheung.

Solution

“Converting to FedReceipt Plus for Returns was the missing piece in the puzzle,” stated Sung. “It made our check clearing process fully electronic and has helped us to mitigate potential losses that might have ensued with those remaining paper items. We value this more timely electronic receipt of our return items.”

Cheung reports that setup was very easy. After working with their Federal Reserve account executive to complete the necessary agreement, the next step was to partner with a third-party software vendor, Rosetta Technologies. “We were able to test Fed files within a month of making the service decision,” reports Cheung.

Benefits to Abacus

Abacus reports improved customer service since the FedReceipt Plus for Returns implementation. With an electronic file of return items arriving at the bank some days as early as 8:30 a.m. ET, customers have access to information earlier and can make decisions based upon it. “This earlier file delivery helps us to mitigate potential losses throughout the day,” Cheung reported. “Our risk exposure has been greatly reduced.”

Positioned for the future

With the implementation of FedReceipt Plus for Returns, Abacus Federal Savings Bank is well positioned to reach potential customers outside its current geographical range. By moving to an all-electronic payments process supported by our Check 21-enabled services, the potential risk associated with the remaining paper items staff dealt with before the conversion has been greatly reduced.

Learn more

The pace of migration to an all-electronic check collection system has been impressive, and receipt of returns earlier, delivered electronically, is a win-win situation. For more information regarding our Check 21-enabled product suite, visit the Check 21 Resource Center or contact your account executive.

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