Most banks, particularly enormous ones like Bank of America and SunBank, have too many electronic check images to store in house. But for customer service and compliance reasons, these images need to be archived, retrieved and transferred. Enter Viewpointe Archive Services, an archiving company based in Charlotte, N.C. that probably has that check you gave to the plumber who fixed your toilet back in 2002. The company has over 40% of America's checks in its archive.
A private company started four years ago by IBM Corp., Bank of America and JPMorgan Chase and Co., Viewpointe now has four data centers and currently stores a whopping seven petabytes (PB) of check images for firms such as Bank of America, U.S. Bancorp Asset Management Inc., Sun Bancorp Inc. and First Tennessee National Bank. Unsurprisingly, Viewpointe's data centers are IBM shops, storing 2 PB on disk in Shark arrays and the other 5 PB on StorageTek tape silos and IBM LTO tape drives for long-term storage. For software, Viewpointe uses IBM's DB2 Content Manager software.
Viewpointe uses a tiered storage approach consisting of three tiers: short-term storage on primary disk in Shark arrays, medium-term storage on StorageTek silos and long-term storage on IBM LTO tape. Based on individual needs, the banks can determine how long images should be stored at each tier. Though banks are free to create their own standards, a common industry standard is keeping images on fast-retrieval media (disk) for 45 to 90 days and then moving them to tape for seven years.
Viewpointe's archiving service, called Imagepointe, is especially relevant to banks because of the ongoing movement to transform paper intensive check payments between banks into electronic payments. "Viewpointe was created because we knew that eventually the physical transfer of paper checks would be taken out of the equation," said John Lettko, chief executive officer of Viewpointe.
That day will come on October 28 when the Check Clearing for the 21st Century Act (known as Check 21) will go into effect. Check 21 will allow banks to exchange check information electronically over high bandwidth telecommunications lines. With Check 21, the days of banks sending off bags of checks to other banks will be over.
According to Peter Gerr, senior analyst with Enterprise Strategy Group (ESG), Milford, Mass., the movement from paper to electronic images represents a change in financial services. "I think Check 21 will usher in the next generation of banking processes. Archiving check images will be a storage challenge for banks, but will ease compliance woes because images are easier to manage than paper."
In addition to archiving check images, Viewpointe also provides an image sharing service that will kick into high gear once Check 21 goes into effect. Image sharing enables two Viewpointe banks to share check images through a common archive, much like sharing a file on the same server. The check image can be accessed by either bank to confirm that a transfer has been made. No exchanging of images needs to take place.
If you're not a Viewpointe customer, then your alternative is to grab images and send them electronically, which according to Lettko, beats physically sending checks, but is "not as efficient as image sharing, where you only capture and store an image once. Exchanging images electronically leads to duplicated storage by both banks," said Lettko.
Other companies that do check archiving include the Federal Reserve and Fiserv, which offers both in-house and outsourced check imaging for medium and small banks. "But Viewpointe's biggest competition is banks that want to do the archiving themselves," Lettko said.