Last year, check-imaging analytics firm Mitek Systems turned heads when it announced plans to market mobile-based remote deposit capture (RDC) software. But when no rollouts materialized, doubts crept in about whether consumer RDC through a cell-phone camera would ever gain traction.
In the last few months, however, Mitek has announced that it has signed on two key partners to distribute its mobile capture system alongside mobile banking and standard office-based remote deposit capture infrastructure.
Also, Fiserv - which counts thousands of banks and credit unions as clients - told U.S. Banker that it is using Mitek's technology to expand its consumer capture services into mobile applications for launch within a year or two. It dropped a big hint in February about its plans when it published a survey touting client institutions' interest in using mobile capture.
Mobile RDC "has triggered a number of banks' interest, both for the consumer side and small-business side," says Rod Springhetti, vice president of business strategy and development for Fiserv's Global Payment Solutions group.
No bank deployments exist, but Mitek chief executive officer James DeBello says he expects some rollouts this spring or summer.
Mobile capture could be just what some banks are looking for as they look to add deposit and bill-pay features for mobile devices already being outfitted for payments. Mobile RDC could also mesh with their needs for low-cost retail deposits from both consumers and small businesses, instead of just the high-volume merchant and business clients.
With Mitek's system, called ImageNet, users photograph both sides of a check and send it over the carrier network to the bank. A back-office Mitek interface at the bank or processor handles fraud analysis and image quality before a check is accepted, and a user receives a text message that the check went through.
The product targets professionals - salesmen, plumbers, beer distributors - who frequently accept checks for services or deliveries while on the road. "We have heating and ventilation contractors as customers, and they get back to the office maybe once a week," says Michael Murphy, vice president of marketing and product management for e-payments processor RDM Corp.
RDM, along with mobile banking developer mFoundry, have both this year inked partnerships with Mitek to add the software to their platforms. "For the banks we're working with, almost all of them have an interest in it," says mFoundry CEO Drew Sievers. These deals, along with a partnership with lockbox systems firm J&B Software, give Mitek an opening to a bevy of big-name banks and brokerages
According to Aite Group senior analyst Nancy Atkinson, only three of 10 major remote capture vendors support consumer capture. Only about 2.5 percent of the 6,000 financial institutions offering remote capture make it available to retail customers, she says.
Still, there are approximately 100,000 consumers and businesses with home capture settings and "going to 700,000 to 800,000 sites is not out of the question," says John Leekley, the chief executive at RemoteDepositCapture.com. But Bob Meara, a Celent senior banking group analyst, is not so sure that they will all be using their cell phones to deposit checks. "It's been kind of a disappointing lack of activity," he says of mobile deposit capture. "Mitek needs partners....and for all the solutions providers out there, very few have invested time and effort in making those solutions work."
Banks may ultimately be wary of mobile capture due to security and compliance issues, such as stopping check-kiting or following know-your-customer requirements, says Don Rhodes, eStrategies policy manager for the American Bankers Association. Before adopting mobile RDC, "the bank would need to have solid customer contacts, a monitoring system and behind-the-scenes technology to see any fraudulent activity taking place," says Rhodes.