Almost ten years ago, the government passed a law that made electronic images of paper checks just as legitimate as the paper checks themselves. As banks implemented the law, it saved time and money by allowing banks of first deposit to scan checks after a customers deposit them for verification with the originating bank. With an image of a check being accepted in place of a paper check, more banks have begun implementing a convenience to customers as well.
Businesses were the first customers to receive these benefits. For a business that receives thousands of checks every day, bringing the physical paper checks to a branch for deposit can be an expensive and time-consuming process, fraught with the possibility of security problems with the checks in transit. Banks have offered business the option of remote deposit. With this service, the customer can scan checks using a specialized imagine device (check scanner) and transmit the images securely over the Internet or a private network connection. The funds are then available immediately rather than overnight.
With this success, banks are in the process of extended similar features to non-business customers. With the proliferation of cell phones with built-in, high-megapixel camera, banks can now offer deposits using snapshots of checks sent via text message or custom smartphone apps. For these customers, no bulky desktop scanner is necessary, and there’s no need to be home to make the deposit. You can effectively deposit checks from your mailbox down the street or from your grandmother’s house on your birthday.
Business customers still have the advantages, with very few banks actively offering this service to non-business customers. The number of banks offering this service to consumers is increasing, however.
Remote deposit is most useful for banks that don’t have local branches, like these online banks. ING Direct, still bloggers’ most favorite bank, is working to implement remote check deposit soon, but with the bank’s planned acquisition by Capital One it’s unclear when new features will be added. ING Direct recently began offering paper checks to customers, so remote deposit capture may not be too far behind.
Chase Bank offers apps for iOS and Android devices. The application allows customers to log into their bank accounts. To deposit a check, take a picture of the front and back, and send the images securely to Chase using the application. The deposit will be recorded as pending immediately, though availability will depend on the bank’s typical schedule, usually next business day availability for local checks. The availability schedule has several variables, though, so always check with the bank to determine when the funds you deposit will be available.
Ally Bank has offered remote deposit for customers since April 2011, but the bank has just recently opened the program to all customers. Ally’s eCheck Deposit service requires a scanner and some manual work, such as inputting the check amount (shouldn’t this be automatically read when scanned?) and aligning the images. Ally plans to offer a mobile application soon.
The USAA Bank mobile application for iOS, Android, and Windows Phone 7 includes a feature allowing remote deposit. [email protected] requires the customer to enter the check amount, take one photo of the front of the check and one photo of the back, and submit the images to the bank through the application. The bank will confirm the deposit amount.
Have you used your bank’s remote deposit service? If so, what did you think of the experience?
Updated March 26, 2017 and originally published October 24, 2011.
{ 22 comments… read them below or add one }
Penfed offers “deposit anywhere” service. It requires a scanner but is very useful and effective.
I tried the Chase iPhone app, but with the 3G lower res camera, it usually failed. Also they have deposit limits and I was trying to deposit a paycheck that was over the limit and IT failed. So I marked the whole thing “FAIL” and moved on.
As banks allow the customer to do more of the mundane work of the bank, what is the payoff to the customer? ATMs are convenient, but it replacces routine activities normally done by a teller. As customers we do more, but the banks raise fees.
Customers benefit by not waiting in lines, not having to drive to the bank, and other convienence items. Although the customer is doing “more” by taking a picture of their check and receiving a lot of convienence, these benefits haves costs. The security and infrastructure required to keep these items functioning and safe have costs that need to be paid for. As banks reduce staff and other expenses because of these advances in technology bank fees should come down or remain flat. Technology has made things easier but also more complex. Banks now need to worry about hackers committing more damaging acts. The safety of your information and the convienence of online banking and remote deposit have significant costs associated with them.
Sometimes fees are the offset for the increases in costs.
I bank with Charles Schwab and love this feature to do remote deposit. All it requires is take a picture of check (front and back) and it processes it in a day or 2. Fast and convenient. Before, I used to have to deposit into another bank (brick and mortar) and then transfer it to my checking account.
We do use direct deposit at work. Saves us a lot of time and money. However, I am still not that sure about remote deposit apps for my personal accounts. I have my safety and privacy concerns (just a personal thing). Maybe one day I’ll change my mind. :)
We use USAA’s remote deposit occasionally and love it. Have had no problems and it’s been very convenient for us. Wish my credit union could offer it to our members…
You are right, this would be great with an online bank account. Don’t have a smartphone, guess I’ll be buying a scanner one of these days! But I’ll wait til they have the bugs out.
I use PayPal’s iPhone app to scan and deposit checks. When collected, I’m able to transfer the money to my linked checking account. Works great. Waiting for ING’s app on iPhone…
PNC has had this for quite some time, and my iPhone 4’s camera works perfectly! I always get it thru on the first try and has saved so much time and money! Thank you PNC!
I haven’t used remote deposit but I do have security concerns about it.
What are your security concerns?
Can’t wait for ING to implement this. One less reason to keep a B&M account around for me.
Having just moved to ING i too hope this gets implemented soon.
ING keeps claiming that it will offer this service soon (and has claimed this for at least a year). That ING does not offer this service is the one thing that keeps my Chase account still open.
Having said that, I have been using remote deposit through my smart phone with Chase for the last several months. It was shaky at first (it used to require multiple pictures before the app would recognize all the pertinent information on the check), but now, I tend to be able to deposit on the first try. It’s a lot easier than having to go to the bank.
Capital One’s planned acquisition of ING Direct stalled all new tech developments at ING Direct, but they are supposedly back on track now. I’m still waiting.
If I ever get a smartphone, I’d probably give it a try.
Rookie question: Once the deposit shows up in your account, do you just shred the check? Or do you hold on to it for a while, just in case?
Hi Donna,
You can destroy/shred your personal checks after you’ve verified that the deposit is complete. Here’s an answer from Chase.
It seems like it’s more worth a business’s time to make the trip to the bank. They can deposit a bunch of checks at once, amortizing the drive across multiple items. Meanwhile when I have to drive to the bank, it’s to deposit one to three checks. I guess the question is if, from the customer perspective, preparing a remote deposit is faster, slower, or about the same as preparing a paper deposit. It does seem like it would be a little slower: with a paper deposit, you sign the back, add all the checks together, fill out a deposit slip, and drive to the bank. With a remote deposit you have to take pictures of the front and back, get the app to accept the pictures, and fill out info about the check (similar to adding up the checks and filling out the deposit slip.) Also there are typically restrictions on remote deposit, though I don’t know if businesses are subject to the same or different restrictions.
From a business perspective — I used to work for a company where it was important that every check received be deposited in the bank that day. Holding onto a few days’ checks to save a drive could result in losing large amounts of potential interest (overnight sweeps beat the lower DDA interest rates). There might have been regulatory requirements that drove the need to deposit everything everyday as well. The company had a courier handle the daily check delivery to the bank (involving third parties adds risk)… in fact, I heard about a company where a truckload of checks “disappeared” — and resulted in some security concerns.
I’ve had a small check in my purse for 2 months now because I never remember to stop at the bank while out and about. When my daughter heard me complaining about yet another check that arrived in the mail that would “eventually” make it to the bank, she told me about tv commercial advertising photo deposits. I then launched the Citibank app on my iPhone and actually found “make a deposit” option! Very easy step-by-step instructions walks you through the process. Deposit posted to my account immediately! I am still amazed that I was able to do this without leaving the sofa!!!
I’ve got an account with Ally, and I love having their remote deposits. It has basically meant that I no longer have any reason to run to my local bank branch because I can just scan in and deposit all of my checks via their website. There have been glitches here and there with their software not completely recognizing some scans, and having to re-do them, but for the most part it’s been a huge time saver.