In an era of busy work days and short weekends, getting all the errands done has become more and more challenging. To help keep that to-do list short, banks have begun launching applications that allow customers to deposit checks from their smart phones.
When Chase launched its banking app back in July, it aimed to put the whole banking experience in the hands of customers. The Chase Mobile app, available only on the iPhone, lets customers check their balances, schedule bill payments and deposit checks from their phone.
It's a matter of a few clicks--a photo of the front and one of the endorsed back--then submit, and wait for the check to be posted.
"Customers are really embracing this," said Daisy Cabrera, media relations manager at Chase. "They're busy executives who don't have time to go into a branch to make a deposit. So taking a picture of the front and back of an endorsed check makes their life a lot easier."
It takes the same amount of time for a check to clear as if it were deposited at an ATM or bank branch. After ensuring the check has been posted to the account, the customer decides what becomes of the physical check, Cabrera said. Some shred it, others void it, and some file it away. That's not to say Chase doesn't maintain a record of the check. For recordkeeping, the images of the checks are saved online.
To protect consumers, Chase uses Chase hopes to follow the success of USAA, the first bank to offer mobile check depositing for its customers, predominately military personnel and their families.
"Because of their military affiliation, our members are highly mobile and needed a way to make a check deposit conveniently," said Danielle Long, USAA corporate communication.
The San Antonio-based bank serves more than 5 million banking customers. The bank launched its Deposit@Mobile application in August 2009. Since then, members have deposited more than 2.8 million checks from their phones, totaling $1.6 billion. Unlike Chase's, USAA's application is available on both iPhone and Android cell phones.
Before other banks jump into the mobile deposit business, infrastructure needs to be in place, said Raj Dhinsa, managing principal of financial services at Verizon Business. "They need to have the basics of mobile banking down" before gravitating to more complicated applications like mobile check depositing.
One of the key components of infrastructure is security.
"Getting customers to understand it is a secure means by which to deposit a check will help the adoption of the channel," Dhinsa adds.
Chase combats potential threats with 128-bit "state-of-the-art" encryption technology, Cabrera said. "It helps to safeguard the Internet traffic and protect the customer's information as it travels from their iPhone to the bank."
For security reasons, a customer needs to be enrolled in online banking at Chase.com before using the app.
Audrey Hamban, 25, isn't concerned about the security of mobile checking. "I monitor my online banking so I'd see if something is missing," she said. Hamban, who works at the Boys and Girls Club in Little Village, said she makes five check deposits a month through the Chase Quick Deposit app on her phone. Once the check has cleared, she voids and tears up the paper check.
"It's pretty neat how [the app] works," she said, adding the application is very helpful.
There are several layers of security with mobile check deposit, Dhinsa explained: security of the network, security on the phone and the security of the application. Those levels help account for any potential risk, he said. Similar to the concerns over banking online, consumers will gain confidence the more they use these mobile banking applications, he says.
Use of electronic banking is expected to increase as the technology comfortable generation matures, said Steve Bruggers, vice president of financial services at MicroStrategy, a business intelligence technology firm.
"Consumers have really embraced the technology," he added. Consumers can now receive statements and make payments online. As check deposits become easier, Bruggers believes the use of checks will actually decrease, as more and more consumers handle their finances entirely electronically.