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Remote deposit

April 12, 2024

"EDeposit" redirects here. For the Australian depository of electronic material, see National edeposit.

Remote deposit or mobile deposit is the ability of a bank customer to deposit a cheque into a bank account from a remote location, without having to physically deliver the cheque to the bank. This was originally accomplished by scanning a digital image of a cheque into a computer then transmitting that image to the bank, but is now accomplished with a smartphone. The practice became legal in the United States in 2004 when the Check Clearing for the 21st Century Act (Check 21 Act) took effect, though banks are not required to implement the system.

This service was originally used primarily by businesses with dedicated check scanners, but with the spread of smartphones and mobile banking it is now common in consumer banks.

History edit

Remote deposits became legal in the United States in 2004 when the Check Clearing for the 21st Century Act (or Check 21 Act) went into effect. The Act is intended in part to keep the country's financial services operational in the event of a catastrophe that could make rapid long-distance transportation impossible, like the September 11, 2001, attacks. The Check 21 Act makes the digital image of a check legally acceptable for payment purposes, just like a traditional paper check.

Before 2004, if someone deposited a check in an account with one bank, the banks would have to physically exchange the paper check to the bank on which the check is drawn before the money would be credited to the account in the deposit bank. Under Check 21, the deposit bank can simply send an image of the check to the drawing bank. This reduction of the transportation time from total processing life cycle of a check provides a longer time for the corporation to process the checks, allowing for later deposits and faster check clearance.[1]

Initially remote deposit capture (RDC) was used primarily by businesses. Check scanners were priced between $250 and $2,500 and were either purchased by the business or rented from the bank. These businesses were also often required to pay monthly fees or maintain a minimum account balance to reduce the risk of fraud. Businesses were screened by the bank to determine the risk of fraudulent checks and bounced checks, and were audited by the bank to ensure proper check handling and disposal.[2]

On July 4, 2009, Element Federal Credit Union (formerly WV United FCU)[3]) became the first financial institution to deploy a smartphone app for mobile check deposit. USAA closely followed launching a mobile application in collaboration with Mitek Systems in August 2009.[4] Several other banks began accepting mobile deposits in the early 2010s as the technology became more popular.[5] Mobile Deposit allows smart phone users to snap a picture of the check with the phone's camera. The application automatically processes the picture and sends it to the bank for deposit. The customer does not mail in the original check, instead voiding or discarding it.[6]

In 2013 the United Kingdom government proposed a similar digital cheque imaging law allowing mobile cheque deposit, which was put into place in 2014.[7][8]

In 2020 Wells Fargo bank was ordered to pay $102.8 million in damages to USAA for infringing on mobile check deposit patents developed in 2008.[9]

Use edit

Remote deposit use has grown. A June 2009 survey by group Independent Community Bankers of America found that 62% of banks in the United States offered merchant remote deposit, and 78% had plans to adopt the technology by 2011.

Client adoption of remote deposit capture was projected to reach 1 million by 2010, and over 5 million by 2012.[10]

According to an industry study conducted in late 2013, only 10% of U.S. banks and credit unions offered mobile deposit, though many more planned to do so.[11] Research by Celent in 2013 showed that 20 million customers used mobile check deposit in 2013, a growth from 10.9 million in 2012 and 2.2 million in 2011, beating previous estimates.[12]

By 2015 Celent estimated 87 million customers were using mobile check deposits, accelerating the decline of foot traffic to bank branches.[13]

The 2020 Coronavirus pandemic accelerated trends of shifting consumer behavior, further increasing use of mobile check deposits and reducing in person check deposits, contributing to branch closures.[14]

See also edit

References edit

  1. ^ "Federal Reserve Board - Frequently Asked Questions about Check 21". Board of Governors of the Federal Reserve System. Retrieved 8 December 2022.
  2. ^ "Remote Deposit Capture: A Primer". www.fdic.gov. from the original on 2 November 2022. Retrieved 8 December 2022.
  3. ^ WV United Federal Credit Union is First with iPhone-based Remote Check Scan & Deposit Finovate Blog, Jim Bruene Posted on July 12, 2009
  4. ^ "USAA's Deposit@Mobile app puts check deposits a mug shot away". Engadget. Retrieved 8 December 2022.
  5. ^ Yerak, Becky. "New wave of banking: Check deposit via smart-phone photo". phys.org. Retrieved 8 December 2022.
  6. ^ Stellin, Susan (2009-08-10). "Bank Will Allow Customers to Deposit Checks by iPhone". The New York Times. pp. B4. Retrieved 14 December 2013.
  7. ^ "Speeding up cheque payments: legislating for cheque imaging". GOV.UK. Retrieved 8 December 2022.
  8. ^ "New proposals to make cheque depositing easier and quicker to be unveiled". GOV.UK. Retrieved 8 December 2022.
  9. ^ "Wells Fargo ordered to pay $102.8M in mobile deposit patent case". Banking Dive. Retrieved 8 December 2022.
  10. ^ Celent's estimates were published on 4 June 2007.
  11. ^ Camhi, Jonathan (2014-01-06). "Celent: Banks Looking to Replace RDC Solutions". Bank Systems & Technology. Retrieved 8 January 2014.
  12. ^ Daly, Jim. "Mobile Devices Capture the Lion's Share of Consumer Remote Deposit Capture Users". Digital Transactions. Retrieved 8 December 2022.
  13. ^ "State of Remote Deposit Capture 2015: Mobile Is the New Scanner | Celent". www.celent.com. Retrieved 8 December 2022.
  14. ^ "Pandemic pushes customers out of branches, banks ramp up closures". www.spglobal.com. Retrieved 8 December 2022.
  • A Little Homework Could Have Saved Banks a Lot of Patents Grief
  • Remote Deposit Capture Comes with Some Risks - A Short Description of Remote Deposit Capture
  • Banks Will Face Competition in the RDC Space
  • Wachovia Corporate Article on the Importance of RDC
  • RDC Overview Overview of Remote Deposit Capture

External links edit

  • Full text of the Check-21 Act
  • FDIC's list of frequently asked questions about Check-21 Act
  • Video of Remote Check Deposit in use at a small business (via YouTube)
  • The Importance of Image Quality

April 12, 2024
remote, deposit, edeposit, redirects, here, australian, depository, electronic, material, national, edeposit, mobile, deposit, ability, bank, customer, deposit, cheque, into, bank, account, from, remote, location, without, having, physically, deliver, cheque, . EDeposit redirects here For the Australian depository of electronic material see National edeposit Remote deposit or mobile deposit is the ability of a bank customer to deposit a cheque into a bank account from a remote location without having to physically deliver the cheque to the bank This was originally accomplished by scanning a digital image of a cheque into a computer then transmitting that image to the bank but is now accomplished with a smartphone The practice became legal in the United States in 2004 when the Check Clearing for the 21st Century Act Check 21 Act took effect though banks are not required to implement the system This service was originally used primarily by businesses with dedicated check scanners but with the spread of smartphones and mobile banking it is now common in consumer banks Contents 1 History 2 Use 3 See also 4 References 5 External linksHistory editRemote deposits became legal in the United States in 2004 when the Check Clearing for the 21st Century Act or Check 21 Act went into effect The Act is intended in part to keep the country s financial services operational in the event of a catastrophe that could make rapid long distance transportation impossible like the September 11 2001 attacks The Check 21 Act makes the digital image of a check legally acceptable for payment purposes just like a traditional paper check Before 2004 if someone deposited a check in an account with one bank the banks would have to physically exchange the paper check to the bank on which the check is drawn before the money would be credited to the account in the deposit bank Under Check 21 the deposit bank can simply send an image of the check to the drawing bank This reduction of the transportation time from total processing life cycle of a check provides a longer time for the corporation to process the checks allowing for later deposits and faster check clearance 1 Initially remote deposit capture RDC was used primarily by businesses Check scanners were priced between 250 and 2 500 and were either purchased by the business or rented from the bank These businesses were also often required to pay monthly fees or maintain a minimum account balance to reduce the risk of fraud Businesses were screened by the bank to determine the risk of fraudulent checks and bounced checks and were audited by the bank to ensure proper check handling and disposal 2 On July 4 2009 Element Federal Credit Union formerly WV United FCU 3 became the first financial institution to deploy a smartphone app for mobile check deposit USAA closely followed launching a mobile application in collaboration with Mitek Systems in August 2009 4 Several other banks began accepting mobile deposits in the early 2010s as the technology became more popular 5 Mobile Deposit allows smart phone users to snap a picture of the check with the phone s camera The application automatically processes the picture and sends it to the bank for deposit The customer does not mail in the original check instead voiding or discarding it 6 In 2013 the United Kingdom government proposed a similar digital cheque imaging law allowing mobile cheque deposit which was put into place in 2014 7 8 In 2020 Wells Fargo bank was ordered to pay 102 8 million in damages to USAA for infringing on mobile check deposit patents developed in 2008 9 Use editRemote deposit use has grown A June 2009 survey by group Independent Community Bankers of America found that 62 of banks in the United States offered merchant remote deposit and 78 had plans to adopt the technology by 2011 Client adoption of remote deposit capture was projected to reach 1 million by 2010 and over 5 million by 2012 10 According to an industry study conducted in late 2013 only 10 of U S banks and credit unions offered mobile deposit though many more planned to do so 11 Research by Celent in 2013 showed that 20 million customers used mobile check deposit in 2013 a growth from 10 9 million in 2012 and 2 2 million in 2011 beating previous estimates 12 By 2015 Celent estimated 87 million customers were using mobile check deposits accelerating the decline of foot traffic to bank branches 13 The 2020 Coronavirus pandemic accelerated trends of shifting consumer behavior further increasing use of mobile check deposits and reducing in person check deposits contributing to branch closures 14 See also editSubstitute check Cheque truncation Lock boxReferences edit Federal Reserve Board Frequently Asked Questions about Check 21 Board of Governors of the Federal Reserve System Retrieved 8 December 2022 Remote Deposit Capture A Primer www fdic gov Archived from the original on 2 November 2022 Retrieved 8 December 2022 WV United Federal Credit Union is First with iPhone based Remote Check Scan amp Deposit Finovate Blog Jim Bruene Posted on July 12 2009 USAA s Deposit Mobile app puts check deposits a mug shot away Engadget Retrieved 8 December 2022 Yerak Becky New wave of banking Check deposit via smart phone photo phys org Retrieved 8 December 2022 Stellin Susan 2009 08 10 Bank Will Allow Customers to Deposit Checks by iPhone The New York Times pp B4 Retrieved 14 December 2013 Speeding up cheque payments legislating for cheque imaging GOV UK Retrieved 8 December 2022 New proposals to make cheque depositing easier and quicker to be unveiled GOV UK Retrieved 8 December 2022 Wells Fargo ordered to pay 102 8M in mobile deposit patent case Banking Dive Retrieved 8 December 2022 Celent s estimates were published on 4 June 2007 Camhi Jonathan 2014 01 06 Celent Banks Looking to Replace RDC Solutions Bank Systems amp Technology Retrieved 8 January 2014 Daly Jim Mobile Devices Capture the Lion s Share of Consumer Remote Deposit Capture Users Digital Transactions Retrieved 8 December 2022 State of Remote Deposit Capture 2015 Mobile Is the New Scanner Celent www celent com Retrieved 8 December 2022 Pandemic pushes customers out of branches banks ramp up closures www spglobal com Retrieved 8 December 2022 A Little Homework Could Have Saved Banks a Lot of Patents Grief Remote Deposit Capture Comes with Some Risks A Short Description of Remote Deposit Capture Banks Will Face Competition in the RDC Space Wachovia Corporate Article on the Importance of RDC RDC Overview Overview of Remote Deposit CaptureExternal links editFull text of the Check 21 Act FDIC s list of frequently asked questions about Check 21 Act Video of Remote Check Deposit in use at a small business via YouTube The Importance of Image Quality Retrieved from https en wikipedia org w index php title Remote deposit amp oldid 1204891907, wikipedia, wiki, book, books, library,

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