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How to use a Check Scanner: Automate check clearing via remote deposit capture

The processing of checks is a time-consuming and error-prone task for businesses. Check scanner software can help automate this process, saving time and money.

Many financial transactions are entirely digital nowadays. Nevertheless, written checks still play a significant role in fulfilling payments. A study by the U.S. Federal Reserve found that in 2019, 14.5 billion checks were written in the United States alone. 

However, the classic way of redeeming a check seems old-fashioned in our digital age: Typically, the payee would have to go to their bank branch to do so. A modern, efficient solution is check truncation, where bank customers simply scan their checks and upload them directly for processing.

A Data Capture SDK is perfect for this purpose. It can be integrated into any mobile application and accesses the device’s camera to take a picture of the customer’s check, reading out the MICR (magnetic ink character recognition) code at the same time. This standardized code contains information that can be used to speed up remittance processing:

  • Routing number
  • Account number
  • Check number

The check scan results in both a high-quality digital check image of the document and the data from the MICR reading.

Identifying information on a check

Many different types of check layouts are used around the world. Additionally, most banks provide their customers with checkbooks featuring unique designs. All this makes automatic processing more difficult. However, checks typically contain the following information:

Information on a check
  1. Name of the person writing the check (drawer)
  2. Date from which the check can be cashed
  3. Name of the person receiving the check (payee)
  4. Amount the payee will receive, written in digits (courtesy amount)
  5. Amount the payee will receive, written in words (legal amount)
  6. Name and address of the drawer’s bank (drawee)
  7. Signature of the drawer
  8. MICR code

When making a check payment, the drawer instructs their drawee to pay the specified amount of money to the payee when they redeem the check. The money value is written down twice to create redundancy and thus mitigate human error.

The MICR code contains the account and routing number of the drawer and is machine-readable. Scanning the check and automatically extracting the MICR code saves enormous amounts of time and effort, especially since long sequences of digits like these are particularly prone to human error when recorded manually.

MICR reader and document scanning software

Scanbot SDK’s Check Scanner SDK allows your customers to scan checks along with the corresponding MICR codes and upload them to your database. Image quality can be enhanced by applying filters to the raw data, preparing it for later processing steps. It never sends any data to our server or those of a third party to do this, as the module operates entirely offline. It therefore also complies with both the GDPR and the CCPA.

The Scanbot SDK can be integrated into any iOS and Android app within one business day. Our developers will support you every step of the way to clear any obstacles your team may encounter. The fixed pricing model ensures that you won’t be punished for your success – you will always pay the same annual amount, regardless of the number of scans made or devices used. This makes planning your budget much more straightforward.

If you would like to extend your app with check scanning capabilities, don't hesitate to get in touch! Our solution experts are happy to discuss the specifics of your use case with you. Let's talk.

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