Q. We've heard alot about ARC and ICL. What arethey and how can it help my organization?
A. ARC is an Automated Clearing House (ACH) Standard Entry Class (SEC) Code that stands for Accounts Receivable Conversion (ARC). The ACH standards allow for different types of payments to be identified by SEC code in order to enforce rules and regulations that apply to that type of payment. In the case of ARC, the basics of this rule state that any check that is being presented for payment of an invoice or bill can be converted to an ACH transaction using the ARC rules if the check is drawn on a consumer account and is less than $25,000.
Converting a check into an ARC payments has two main advantages. First, ACH transactions typically clear before check payments, which means you will receive fewer returns for insufficient funds. This can be a real advantage for credit sensitive businesses. Second, banks'ACH transactions typically cost less 50% than checks to deposit. This allows you to reduce overall banking fees and improve availability of funds.
ICL stands for Image Cash Letter and what it really means is that banks can accept check images as the legal equivalent of the original paper checks. The ICL standard was developed in response to the Check 21 law that mandated banks to accept electronic check images for clearing and settlement rather than relying on the physical version. Until recently, Check 21 has really been reserved for very large check depositors or bank to bank clearing. With advancements in image technology and payment processing solutions like ClearDeposits, more businesses can use ICL for sending bank deposits and eliminate trips to the bank.
Q. We already have a Lockbox solution. Can US Dataworks handle just our ARC and ICL transactions?
Yes. ClearDeposits is fully capable of working with your existing lockbox solution to complete the deposit process with check conversion to ARC or creation of an ICL file for Check 21 items. In fact, ClearDeposits is currently used by some leading providers of lockbox solutions to provide this capability. ClearDeposits is simple to implement as part of an existing lockbox process and the low subscription pricing pays for itself through the reduced banking costs.
Q. How long can US Dataworks store our ARC and ICL transactions for research by our customer service staff? Can I run reports against this data?
We typically store information in the ClearDeposit solution for 60 days to allow for proper handling of returned items and immediate customer research. US Dataworks can store this information for additional periods of time ranging from 2-7 years for an additonal cost.
All of this information is stored on our private cloud environment, so you don't have to worry about storage capacity. Customer service representativescan perform research for a specific payment, customer, dollar amount, date, and more for this extended storage time. ClearDeposits stores the image of the payment, as well as the entire payment lifecycle including when the deposit was made and if there were any returns or exceptions.