DEBT SERVICES

Accounts Receivable Conversion - ARC
(REMOTE DEPOSIT)

Description:
Accounts Receivable Conversion (ARC) or Lockbox Truncation describes the process of converting a personal paper check into an Electronic Funds Transfer (EFT) through the Automated Clearing House (ACH) on checks that are sent via mail or other means to a merchant for payment of goods and/or services. ARC can also be used in payment locations where the payments are batched daily for processing.

The EFT Network ARC system is a Web-based system that captures image and check data for the purpose of Accounts Receivable Conversion. The data is confirmed by the Biller and submitted to EFTN over the Web connection.

Once submitted the paper checks are converted into electronic entries and debited from the check writer’s account. The EFT Network system can also convert non-consumer items (cashier checks, paychecks, government checks, etc.) by printing IRDs (Image Replacement Documents) and submitting them to the banking system.

Benefits of Conversion:

1. Your account is credited within 2 business days of the file submission date – Monday file by 5PM EST is in the account Wednesday morning (Risk Management Assessment is performed on all company applications).
2. The EFT Network system handles consumer and business checks. Business checks are cleared by printing and depositing a substitute check (an IRD) through our system. For business checks, the funds are deposited into and cleared through our bank and electronically deposited into the biller’s bank account. (Higher fees apply to IRDs).
3. Reduces labor fees.
4. Reduces employee errors.
5. Eliminates transportation charges.
6. Reduces fraud.
7. Reduces NSF and overdrafts (Electronic Checks go to the head of the processing line at most banks).
8. Remote locations can deposit the money to a central company bank account.
9. NSF and other returned checks are available in 3 business days.
10. NSF checks can be re-presented immediately, along with an NSF fee - you keep all the fees (separate written authorization is necessary to collect the fees).
11. A results file is downloaded by the biller, showing the results of every file along with any returned checks and giving you the exact reason for the return.
12. System produces ASCII files to export to accounts receivable or for other reporting scenarios.
13. Software can be customized to supply additional information, reports, etc.
14. No deposit slips, etc.
15. Reduces handling costs.
16. Low NSF Fees
17. No Deposit or NSF Fees from your bank.

EFT network ARC - How It Works:

1. The EFT Network system is a Web-based conversion system.
2. Biller receives check for payment of goods or services.
3. Biller scans check using a check imager. Biller can use a simple one-check-at-a-time imager or a high-speed imager capable of scanning 1 check per second. In addition to uploading the proper information to the EFT Network, the imager will save the image to a file where it can be maintained for 7 years per NACHA requirements.
4. The EFT Network system can image checks alone or can image a check and stub. The stub can be encoded (simple number format) so that it inputs the customer data into our Web system. The check immediately follows and the data from the two are merged to form the transaction information for that check writer.
5. The biller views the check and stub data online, confirms correctness, and submits.
6. If the biller is using checks with no stubs the biller keystrokes $ amount and insures correctness of data into the online system – this is done by viewing a snippet of the check and the check data on the biller’s screen.
7. Once batches are approved they are submitted to the EFT Network.
8. EFTN translates the data into a NACHA file and sends the files to the ACH.
9. Credit is made to the merchant in 2 business days provided the merchant transmits to the EFTN processing center before the daily cutoff time (5PM EST).
10. In 3 business days all results files (paid and unpaid items) are downloaded by the biller.
11. All NSF checks can be immediately resubmitted by clicking on them – a fee may also be collected if proper authorization has been received.

Imagers Used for Conversion:

Several imagers can be used. The Magtek imager is a one-check-at-a-time imager and requires that a check be passed through twice to image front and back. The other imagers we work with scan 25 to 100 checks at a time (front and back).