Host processor

The host processor maintains a check cashing data base. The contents of the data vary by vendor.

Most data bases are maintained by drivers’ licenses. Other indexes used are major credit cards and social security numbers.

Some vendors maintain only check cashing patterns.

Some vendors maintain check cashing history by establishment type.

Data input to the data base results primarily from retailer supplied information. Some vendors utilize information supplied by a department of motor vehicles, financial institutions, and law enforcement agencies.

The check guarantee underwriting decision is based upon a number of criteria including the check amount, the type of retailer (massage parlors pay a much higher premium than do shoe stores), and check cashing patterns.

The guarantee approval /disapproval is communicated to the retailer via the data entry operator or, more frequently, by audio response units.

Check guarantee vendors provide services both directly to retailers on their own networks and to financial institutions which place terminals with retailers. Check guarantee voice networks are a combination of local area dial-up and WATS.

There is a wide variety of retail authorization terminals which permit electronic check guarantee transactions. The more recent models are designed for both check guarantee and credit card authorization transactions. Their characteristics are outlined in Section F, Trends. A major feature of retail authorization terminals is automated dialing of and message formatting for alternate check guarantee voice and data networks.