Financial Institutions join forces to increase direct deposit.

NEW YORK--(BUSINESS WIRE)--September 10, 1996--For the first time, financial institutions in the Northeast have joined forces to increase the use of Direct Deposit among eligible consumers, and beginning today, the ambitious enrollment drive is on.

Created under the auspices of The New York Clearing House Association, this public participation campaign is designed to boost overall consumer usage of electronic payroll deposit by 5 percent each year over the next five years in the second Federal Reserve district. The campaign, which was developed by Chase Manhattan Bank, Citibank, N.A., Fleet Bank, PNC Bank and Republic National Bank of New York, will be launched today with a kick-off breakfast for financial institutions in New York City at the Grand Hyatt Hotel.

It is estimated that approximately 38 percent of the population uses Direct Deposit in the district, which includes New York, northern New Jersey, southern Connecticut, Puerto Rico and the U.S. Virgin Islands. A method of payroll processing, Direct Deposit allows employees to have their pay automatically deposited into their bank accounts via electronic file transfer.

"In the New York metropolitan area alone, employees make over 70 million trips to the bank each year to deposit or cash their paychecks, but they don't have to," remarked Jill M. Considine, president of The New York Clearing House and former New York State superintendent of banks. "For the first time in history, the banks as a group are reaching out to individuals -- through their employers and financial institutions -- to let them know that Direct Deposit is a safer, faster and more convenient way to get paid. We're committed to getting hundreds of thousands more people in our district to participate."

The public participation campaign is a comprehensive effort to do just that. Targeted directly to consumers, and involving employers, financial institutions, government officials and community, professional and civic groups, the central focus of the campaign is "Direct Deposit Week," an opportunity to spur excitement by offering incentives for consumers to sign up for Direct Deposit during the week of January 27-31, 1997. Radio promotions will take place in local markets at this time, and financial institutions and corporations are encouraged to host activities for their customers and employees.

The participation campaign also includes: direct mailings to human resource directors and a variety of membership organizations; distribution of how-to guides and manuals to employers and financial institutions; and regional meetings for banks and credit unions later this month in Rochester, N.Y. and San Juan, Puerto Rico. In addition, employers and financial institutions will be able to purchase promotional materials, such as Direct Deposit brochures, posters, pins and statement/paycheck stuffers, at cost, through The New York Clearing House for distribution to their employees and retail customers.

As part of the campaign, an advisory council comprised of public and private employers has been formed to lend input on experiences with Direct Deposit in their organizations. Among the organizations represented are NYNEX, the New York City Office of Payroll Administration, the American Payroll Association, the State of New York and Nassau and Suffolk County.

"Direct Deposit is a win-win situation for everybody. It's safer, faster and more convenient for employees, reduces expenses for employers and helps financial institutions increase customer satisfaction," said George Thomas, senior vice president at The New York Clearing House. "Once people realize how easy it is to enroll and how convenient it is to have, they'll wonder why they didn't sign up for Direct Deposit sooner."

The New York Clearing House Association is the nation's oldest and largest bank clearing house. It participates in regulatory, legislative and litigation matters of importance to commercial banking. On a normal day, the Clearing House provides document exchange and settlement services for about five million checks, drafts, and other paper items. The Clearing House Interbank Payments System (CHIPS), which substitutes electronic transmissions for paper checks in international dollar payments, transfers over $1 trillion in payments daily. The Clearing House also runs the New York Automated Clearing House (NYACH), which processes payments electronically among domestic financial institutions in New York, northern New Jersey, Puerto Rico, and the U.S. Virgin Islands. In 1992, the Clearing House launched the Clearing House Electronic Check Clearing System (CHECCS) to aid in the prevention of check fraud.

The member banks of The New York Clearing House Association are The Bank of New York; Citibank, N.A.; Chase Manhattan Bank; Morgan Guaranty Trust Company of New York; Bankers Trust Company; Marine Midland Bank; United States Trust Company of New York; Fleet Bank; European American Bank; and Republic National Bank of New York.

CONTACT: Rossana Czelusniak

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