NEW BRUNSWICK, N.J. -Rutgers University Student and Alumni Federal Credit Union (RUSA FCU) President Ken Buren has found that it pays to take the time to find the right Check 21 fit. "About a year ago we started looking into Check 21 and at the time I thought it was just a federal law that didn't have a tremendous bearing on the business," said Buren. "There was a lot of general information available on it but not a lot of knowledge of its uses in expanding the credit union." That changed when Buren met with one of the principals of Skyline Data and discovered what he says is a unique solution to the check clearing process. "This was the only service we found that transmitted images directly to the Federal Reserve," said Buren. "That alone saved us $20 to $25 a day in courier fees to pick up and take the checks to a corporate credit union for processing." Skyline Data donated the check scanner and software dubbed DIRECTFED Deposit to the over $3 million credit union -making it the first in New Jersey to implement the service. Here is how it works. The scanner creates an electronic image of the front and back of the check, reading the MICR line and dollar amounts including the routing numbers. The scanner system also gives a confidence rating regarding how well the check was read- eliminating the manual process of encoding and manually entering each check. "It really cuts the float time. The first check we ran through this system was drawn on a North Carolina-based credit union and it cleared in less than 24 hours," said RUSA FCU Manager Melissa Rivera. "It also is a big help with NSF items- we now get them back within 48 hours versus the 78 hours it used to take." Rivera says in addition to cutting down on NSF items, the system automates the back office operation, speeds up settlement and helps members get their deposited checks settled much more quickly, which increases their cash flow. Buren says installation is simple and once the paperwork with the Fed is processed, which can take up to two weeks, checks can be scanned immediately. "It is a 10 minute learning curve," said Buren. "Skyline was generous to donate the equipment to us but even the $150 a month to rent it is still a savings compared to the $500 a month in courier fees we would pay. It is amazing and we've been wondering why we haven't been doing this for years." As a low income-based student credit union, Buren says to generate additional deposits, the credit union is reaching out to small businesses that have business accounts with the credit union and is offering to install scanners rather than having the traditional relationship of zippered bags for their deposits. "Small businesses can then scan checks at the end of the day and have them directly sent in for clearing, making their businesses run more efficiently," said Buren. "We think it will help us build up deposits, giving us the ability to turn around and lend out more to our members. It is our investment in the people and businesses in our community." Part of the strategic plan is for the credit union to rapidly move out into business accounts targeting those organizations that handle large check volumes from church groups and waste management to car dealers. Since the scanners also have the ability to read stubs, talks are underway with Rutgers University to set up a pilot program to scan incoming checks and tuition stubs to help automate some of the university's traditional keypunch operations. "We really think this will help us grow," said Buren. "So far no one has reacted negatively to this move including the corporates . This may not be the solution for everyone but we're very satisfied with how it is working here." [email protected]