CHECK PROCESSING AS AN INFORMATION MANAGEMENT ACTIVITY: CRITICAL REVIEW AND RESEARCH AGENDA

Abstract

Current management science models fail to adequately recognize that treasury management related to check payments has largely become an information management activity. Check processing operations lack the flexibility to capture information which can be used by treasury managers to make the most effective utilization of check-related funds. This argument is developed by examining the fit between management science models and check processing practice in the U.S. banking industry, as well as at the Federal Reserve Bank, in view of the changes that information technology has wrought and the problems it has the potential to solve. We critique models for inbound and outbound check processing and treasury management for checks, and conclude that models which link check processing and treasury management models hold out significant promise for improving management control.