Carreker Named to American Banker and Financial Insights’ FinTech 100

American Banker, November 2, 2004

In early November American Banker and Financial Insights released the FinTech 100, which ranks technology providers that derive more than one third of their revenue from technology for financial institutions.

Following are excerpts from the article:

The reality of image replacement documents completely replacing paper checks is still a ways off. (The Check Clearing for the 21st Century Act went into effect only last month.) Nevertheless, industry insiders and analysts say, Carreker is already playing an active role in the development of the technology that will eventually lead to a more complete implementation by banks.

Carreker, which ranked 41st on the American Banker/Financial Insights FinTech 100, is one of the oldest names in the check imaging industry and, perhaps, the vendor with the farthest-reaching vision. That vision includes equipping banks to exchange electronic images, as well as to offer the archiving, fraud detection, and other services associated with image exchanges.

"We have the broadest footprint in the world in the check space, and as that is becoming electronic, we are picking up all of the of the payment types and trying to grow the footprint," said John D. "Denny" Carreker, the company's chairman and chief executive officer.

But industry insiders and experts say Carreker has an advantage over the competition.

"They have the most complete range of [Check 21] software and were the first to market in the large-bank market," said Bob Hunt, a senior analyst for TowerGroup.

Carreker said it works with the top 20 U.S. banking companies - including Bank of America Corp., J.P. Morgan Chase & Co., KeyCorp, Wells Fargo & Co., and Wachovia Corp. - as well as three quarters of the next 100 largest.

Mr. Carreker said that his company has "the dominant share of presentment technology" but has had to create software that would let banks ship images with detailed magnetic ink character recognition data and account for exceptions and image returns.

"We had technology in all those areas, but it had to be image-enabled," he said.

Carreker's large-bank customers have frequently been in the vanguard implementing Check 21 technology. In an pilot test that began Aug. 27, KeyCorp and Bank One Corp., now part of J.P. Morgan Chase, are exchanging images for 500 retail accounts at each bank. Though the images are exchanged through SVPCo, KeyCorp said it uses Carreker's ExchangeLink technology for the exchanges.

"We effectively started designing this process with them about a year ago in October," said Keith Krueger, the senior project manager for client services for KeyCorp, of Cleveland. "They have done a tremendous job in producing a product that is well designed and well integrated and does everything we asked them to do."

Similarly, Bank of America said it would conduct its first image-exchange pilot test with a bank partner, which it would not name, through SVPCo this quarter. Early next year the Charlotte company plans tests with two other banks, which it would not name.

B of A said it is has developed its Check 21 capabilities through a combination of in-house efforts and work with a variety of vendors, including Carreker.

The adoption of Check 21 technology by banks "is going to be more of an evolution than a revolution," said John Feldman, B of A's image executive in transaction services. "As more and more banks come into this community, the value will grow exponentially."

Mr. Carreker predicted that there would be an explosion in the use of Check 21 technology by banks in the next three years, and that his company would be positioned to capture that new business.

The next three years will bring more change in the payments business than there was in the last 10 to 15 years, he said. "We are very excited to have the good fortune of having a customer footprint with the biggest and best banks in the world and a tremendous technology legacy position that we can leverage as the banks migrate through this period."