Ask a U.S. consumer if he or she would prefer to deposit checks by snapping pictures with a smartphone, rather than driving to a branch or an automated teller machine, and chances are you'll get "yes" for a response.
So far, banks have been slow to jump on this bandwagon. USAA was the first to offer it and JPMorgan Chase, PNC and U.S. Bank followed, trailed by some smaller institutions.
Look over the horizon to 2012, and the picture seems brighter: more than half of financial institutions say they plan to offer RDC in the next six months, according to a recent survey of bankers by Javelin Research. But when it comes to RDC, the lag between planning and delivery has occasionally been a significant one. Bank of America announced that it would offer RDC for iPhones about 15 months ago (and Mitek announced the banking giant as a customer in May), but has yet to introduce the service. Overall, a third of bankers Javelin surveyed who don't provide mobile RDC said that fraud was their biggest concern; specifically forgeries, duplicate deposits and check manipulation are feared.
Mary Monahan, research director at Javelin, says she believes bankers' worries about fraud are overblown. "The financial institution survey we did didn't show any increase in fraud among banks that offer mobile RDC," she says. "The patterns are similar to traditional check fraud, which is already being monitored through back-end fraud processing systems."
There is some risk to letting customers scan checks remotely versus face to face, she acknowledges, but if a bank already lets customers conduct scanner-based remote deposit, the risk is similar.
Javelin's research also highlighted an upside for banks in offering mobile RDC — cost savings. At USAA, it costs four cents to process a check through mobile RDC, versus $1.21 through traditional means. Other bankers we've spoken to point out that USAA is unique because of its branchless model, and that typically, mobile RDC actually costs a bit more than paper check processing. Nonetheless, the numbers do make a case.
Cost numbers aside, demand does seem to be there. Javelin surveyed 5,102 consumers who already use mobile banking, and within that set 52% who didn't have mobile remote deposit capture, expressed interest in it. "Consumers want this," says Monahan. "One in four consumers say it's desirable; that's a big group," she says. "Among mobile banking users, it's even higher, over half. That's huge."
When they'll get it remains the question.
