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"We're not here to sell anything, but to educate you on the benefits of check processing," said Patrick Donahue, vice president of business development for the Philadelphia Fed, shortly after handing out a packet that included a price list for services the Philadelphia Fed can provide banking customers.
Representatives of the Fed argue it makes sense to handle a paper check as few times as possible. As long as the Fed is processing information from checks as part of its normal responsibilities, the argument goes, it should capture the image for banks' use at the same time.
Meanwhile, the possibility of the Fed's withdrawal from the check processing and automated clearing house (ACH) business looms. While They're There... "The idea we're working on is disassociating physical check processing from account management," said Blake Prichard, senior vice president of the Philadelphia Fed. "Ideally, these banks won't have to have check sorters in the future. They will process the account information, but not the actual check. We're already collecting the information from checks, so it's not much of a step to capture the image at the same time." Objections To The Fed Not everyone is enamored with the Fed's venture. Rep. Carolyn Maloney (D-N.Y.) says the Fed is unfairly using taxpayer money to subsidize its check processing services. She avers the Fed charges a lower price for imaging than private competition and makes up the difference with profits from other areas (IPR, Aug. 14, p. 1). Prichard answers the charge by saying critics don't see the full picture.