Photo: The EC7000i two-sided imager is the ideal solution for merchants who want to take advantage of electronic cheque processing.

Accepting cheques as payment can cost merchants considerable time and money. The process can take several days from the time of a sale to deposit in the merchant's account. In the U.S., a multitude of independent banks scattered across the country makes the process of moving all that paper around even slower. When the tragic events of September 11, 2001 halted transportation systems across the U.S., the vulnerability of the paper-based cheque processing system was highlighted as never before.

"For cheques to clear, they have to go from one institution to another, and if transportation is grounded, money can't move," says Jim Merwin, Chief Financial Officer at RDM Corporation. "After 9/11, the U.S. government changed the rules for cheque processing and allowed banks to replace original cheques with substitutes made from digital copies. This gave us a tremendous opportunity to build on our strengths in the U.S. market."

RDM has been a market leader in small document imaging and imaging processing for over 20 years, with several industry firsts that include a low-cost, digital imaging cheque reader and a groundbreaking image archive system. In 2003 RDM introduced its Image & Transaction Management System (ITMS), a web-based software product to address the needs of financial institutions and corporations that want to take advantage of electronic cheque processing.

"Remote deposit capture is probably the biggest innovation in cheque processing in over 40 years," says Merwin. "It has allowed RDM to become a pioneer in developing the secure payment systems that the U.S. legislation requires. With our product, you can do business in New York even if you're in Utah. No one has to physically collect the cheques and no one has to physically deposit them."

The sophisticated system is simple on the surface. A merchant scans a cheque and transmits the image electronically to an authorization provider, who runs it through a data base comparison. Authorization is immediate, and the customer signs a receipt for the approved transaction. Throughout the business day, electronic "cheques" are bundled in batches and transmitted for electronic deposit. The electronic form of the cheque, not the paper form, is what is settled.

"Canada's banking system is in some ways more advanced than the U.S. system," says Mauricio Ospina, International Marketing Consultant – US market, IT sector, in the International Trade Branch, for the Ontario Ministry of Economic Development and Trade (MEDT). "RDM's technology has tremendous potential to accelerate payments and improve cash flow, because the conventional U.S. clearing system can take up to five days as actual cheques must be physically transferred from point A to point B."

MITI's International Trade Branch helps Ontario-based companies access international markets via trade missions and support at trade shows in key markets around the world, incoming delegations of buyers, market seminars and export education programs.

RDM's products are certainly win/win for both banks and their clients. RDM's electronic cheque processing provides them with a way to get deposits into the bank, inexpensively. Electronic cheque processing is also a win for the bank's corporate clients. With their cheques being scanned, clients get instant and real-time information, without waiting to hear from the bank if a cheque is good. There are also huge transportation and productivity savings for both banks and their clients.

RDM currently exports their electronic cheque processing systems to the U.S., where 68 billion cheques are written each year and delays in having cheques clear are significant. Merwin also attributes RDM's success to their trusted industry partner - the United States Treasury.

"In 1998, the US Treasury selected RDM as their partner to design, build, and install their electronic cheque conversion platform," he says. "It has since been rolled out to over one thousand US government agency locations around the world. When the post 9/11 legislation made electronic cheque processing viable in the private sector, we had the experience and the credibility required to make us the industry leader in this new field."

RDM's success in the competitive U.S. market has not been without challenges, especially with the decline in the U.S. dollar. The company's export success strategy includes sourcing components priced in U.S. dollars, to avoid the impact of currency fluctuations.

"We're always looking for solutions that will help us to provide value to our customers, drive our revenues, and reduce our risk, which can be substantial when you're heavily involved in R&D as we are," explains Merwin. "But we are well-positioned to meet these challenges head on."

Website: www.rdmcorp.com