Remote deposit capture is finally moving into small-mid size businesses. The allure of being able to scan checks to electronic transactions and avoid trips to the bank is understandable attractive to business owners.
Wausau Financial Systems in an effort to bring remote deposit capture to smaller businesses has aggressively been recruiting independent sales organizations (ISO) to sell the product. The squeeze of margins on credit card processing has driven many an ISO to seek alternative product offerings to boost declining revenues.
But, can an ISO really make money selling remote deposit capture? on the float in the accounts and from selling merchants other products or services.
If an ISO already has customers who will benefit from remote deposit, it pays to offer the service. Without an existing customer base, an ISO will work hard to low-value business.
Remote deposit capture is a volume driven business where ISOs make a few cents per transaction. There’s hardly money in accounts processing less than 500 checks per month. And the real money is with accounts processing thousands of transactions per month.
It’s not cheap for a merchant to being using remote deposit capture. The biggest expense is buying a scanner. Prices are coming down, but a good scanner still costs upwards of $500.
The biggest competition to the ISOs is banks who can offer merchants free or low cost scanners in exchange acquiring direct deposit accounts. Offering remote deposit capture as a loss leader makes good sense for banks. Banks make money direct deposit accounts from float and from cross-selling more profitable products to the merchant. But, for the average ISO, remote deposit capture is not worth pursuing.
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