ECP Process Overview
THE ECP (Electronic Check Processing) process
uses electronics to move check information
more
efficiently
between
depositing and paying banks. Depositing
banks begin the funds collection process
by transmitting check data while
continuing the presentment of the physical
checks via ground and air transportation.
Checks deposited on a Monday can be presented
electronically to the paying bank anywhere
in the country for posting that same evening.
The paper checks will usually arrive the
next day (Tuesday) for inclusion in the
return processes. Because ECP can be completed
faster than physical check presentment,
the check clearing process can be accelerated
by at least one day (typically two to three
day acceleration) and the return process
can be initiated on Tuesday
rather
than
on Wednesday.
Minimal Operational Impact
Inovium, as a member of
ECCHO, abides by the rules set for by the
organization. ECCHO's rules assume that
paper checks continue to flow
from
originator
to depositary
bank to paying bank just as they do today.
While truncation and safekeeping of checks
are desirable and possible under ECCHO's
rules, the volume of truncated checks is
expected to remain relatively small for
many years.
The processing steps for ECP remain paper
based from start to finish with a small,
but very important, electronic step in the
middle.
The ECP approach, therefore, is to minimize
changes to the existing paper check process.
When the presenting bank produces a paper
cash letter, it also creates an electronic
cash letter from its existing check capture
files. Both the paper and electronic cash
letters are sent to the paying bank. Because
electronic transmissions are faster than
ground or air transportation, the ECP files
would typically arrive before the initiation
of the posting cycle and the paper cash
letter would arrive the next day in time
for the exception pull process.
After the paying bank receives and captures
the paper checks, it then reconciles the
paper checks with the electronic items to
determine missing or free items. The items
to be returned are then pulled and the return
process initiated.
Frequently Asked Questions
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