Most banks find mobile check deposit poses little risk, a new survey from Remotedepositcapture.com has found.
In the survey of 246 financial institutions (80% of them banks, 20% credit unions), 80% said no losses have occurred at their institution through the use of remote deposit.
The primary and some say only risk to mobile deposit capture is duplicates — the same physical check being deposited more than once. A customer might deposit a check by taking a picture of it on her smartphone, then bring that same check to a Walmart or bank branch to cash it. "Fraudsters are out there and they're going to try to exploit all the different channels they can," says John Leekley, founder and CEO of RemoteDepositCapture.com. "When it comes to mobile RDC, duplicates are an issue, but fortunately the industry is managing the risks." More could be done, however.
"It's a bit of a Wild West when it comes to duplicates and which financial institution incurs the loss," says Scott Carter, chief marketing officer at Mitek. "It's not clearcut or simple." Reg CC and clearing laws are being reviewed for possible changes to clarify who is liable.
To prevent duplicates, most (84% of) banks set deposit value limits (e.g. a customer can't deposit more than $3,000 a month). Almost three-quarters (71%) use image quality analysis to detect fraud. More than half (59%) examine the courtesy and legal amounts on each check for a mismatch. Deposit volume limits (curtailing the number of checks deposited) are also applied at 54% of banks.
Banks also manage their mobile deposit funds availability to minimize risk. Only 9% offer immediate funds availability; 19% will make funds available the same day if the deposit is made before a certain time. The majority (51%) offer next-day funds availability. A small number make customers wait two (16%) or three or more (9%) days for their money.
A multi-pronged approach tends to work well to mitigate mobile deposit fraud, Leekley observes. In the future, he expects banks to use more duplicate detection services (e.g. Early Warning's service) and check verification and guarantee methods.