Compliance by hard copy
Other documents, such as contracts, must be retained on paper for legal or regulatory compliance reasons. "As much as we've gone electronic in our core business, we still have contracts, trust agreements, etc., that are required to establish a relationship with the bank," says Thum. Such documents are scanned, but electronic versions are complementary.
"I would be surprised to see actual, legally binding documents maintained in purely electronic form," says Ernie Harris, product manager at Raymond James Financial. The financial services firm uses imaging technology for inbound documents and faxes, but the desire to eliminate paper-based transactions with customers is tempered by regulatory requirements and a cultural preference for signed forms. The company processes hundreds of thousands of paper-based requests to open, update or change customers' accounts each month.
That paper adds up quickly. A new client who is retired typically opens at least six accounts and signs 20 to 30 pieces of paper, says Harris. Currently, 50 percent of the company's transaction requests come in by mail or fax.
Raymond James aims to address that by creating dynamic documents that consist of a common form and modules that can be integrated based on a customer's needs. "You only have to sign one contract. Now we're talking about signing one, two or maybe three pieces of paper [instead of 30]," Harris says.
Some legal documents could go away if digital signature technology became widely accepted. Harris says he is one-third of the way through an evaluation of digital signature technology that could eliminate paper contracts. That system includes a digital capture pad that embeds a secure signature image and document hash into a Word or PDF file. However, he doubts that digital contracts will replace paper anytime soon. "We have hundreds of years of comfort applying pen to paper. It gets really uncertain when you start applying digital representations of those things," he says.
However, the payoff of a transition to digitally signed documents would be huge. "We have the potential to make a quantum leap forward in terms of service-level turnaround. Clients could have their accounts open and ready for a transaction within minutes," says Harris.
Paper has also faded as a medium for archival storage. Bank of New York estimates it has imaged more than 290 million documents since it began scanning in 1997. Thanks to imaging and technologies such as the PDF, paper is rapidly disappearing as an archival medium, says Keith Kmetz, an analyst at IDC. "Printing is not necessarily a permanent record anymore. [It] has become a temporary repository of information," he says.
However, disposable printouts -- a temporary instantiation of electronic documents that are discarded after use -- are likely to continue because people like the contrast and feel of paper. Such printouts may actually be increasing in some areas, says Kmetz. To better manage that, companies are deploying document accounting systems that track who printed what when.