When you deposit a check at a bank, the funds may enter a nether world called “deferred availability”—a period that can last up to nine business days for some new accounts—when you can’t withdraw the deposit as cash or use it to write checks of your own. The goal of the delay is to deter fraud or embezzlement. But it can impose difficulties for the depositer, and sour their relationship with the bank.

Now a Fort Worth-based company is stepping in to make that delay go away. Today VALID Systems, a leader in “account-based decisioning” and real-time machine learning models, announced its launch of InteliFUNDS, a new service that enables banks to make up to 99% of check deposits “instantly available with no risk to the institution.”

Rodney Drake, CSO of VALID Systems

If a check approved by the system bounces and causes a loss for the bank, it’s covered by VALID Systems, the company said. It’s confident enough to do that because it says InteliFUNDS “eliminates up to 95% of check deposit losses,” while generating customer value and driving multiple efficiencies throughout the deposit process.

“Check fraud had been on the rise through 2018 and 2019 until the pandemic offered a reprieve from the onslaught, but that was only temporary,” VALID Systems Chief Strategy Officer Rodney Drake said in a statement. “As government stimulus funds dried up, check fraud has come roaring back. By guaranteeing against losses caused by returned checks, InteliFUNDS enables banks to deliver on customer expectations of instant access to their check funds while providing the institution with powerful safeguards.”

VALID has approved $158B in deposits for instant availability

Founded in Fort Worth in 2003, VALID provides financial institutions with “instant risk decisioning” for deposits, checks, loans, and more. It does this with real-time machine learning models and “2.5 billion unique features used with our risk decisions.”

“With more than $200 billion in decisioned checks under our belt, we’re a pioneer in check authentication and risk decisioning,” the company says on its website. “In fact, we were the first company to cash a check through an ATM.”

VALID says its quantitative analytics and portfolio scoring tools “deliver the business intelligence and insights banks need to create new revenue streams and drive profitable growth.”

That goes for personal lending, too. VALID says its clients put the company’s risk decisioning system to work on their own data, to drive both credit inclusion and profitable growth.

Comparing a bank’s data to an athlete needing training

“We teach your data how to properly train,” VALID tells financial institutions through its website. “The right data being fed in real time ensures fraudulent behavior is identified the moment it’s presented, not after an event.”

And the company doesn’t rely only on its software. VALID says its Decision and DataScience teams “are the brains behind the engine,” enabled by the company’s technology group.

20 years of VALID milestones

In 2004, VALID Systems launched the first bank-offered non-customer check cashing program in the U.S. It entered the retail check-cashing space in 2010, and implemented its visual analytics system three years later. In 2016 VALID added real-time event monitoring, and reached the $1 billion mark in lifetime checks approved. The company launched InstantFUNDS within mobile devices in 2017, and within ATM machines in 2018. 

VALID’s tech stack ramped up in 2019 with the implementation of “machine learning decisioning” and the launch of “real time loss alerts,” the company says. In 2021, VALID marked $100 million “in total lifetime client fee revenue generated.” 

Now, with the launch of InteliFUNDS, VALID says it’s achieving “nine-figure savings in annualized value” for its largest clients with results that scale for most financial institutions. 

VALID says the benefits of using the new service include:

• Higher customer satisfaction and improved net promoter scores

• Decreased charge-off losses and fraud

• Decreased customer complaints and call center volume

• Lower cost to serve and deposit migration

• Controllable losses and lower turnover of frontline employees and more

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