Using Your Cell Phone Camera to Deposit Checks

Banks are already deploying technology that lets you use your cell phone to deposit checks into your checking account.
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One reason some consumers have stayed away from online checking accounts is the time lag in getting their accounts credited when they have to mail in checks for deposit.

But a growing number of banks are finding a way around that, and among the most promising new deposit methods is via the cell phone. That’s right: you simply take a picture of the check with your phone, and the deposit is made.

USAA Bank was the first to launch mobile depositing capability with the iPhone and later the Android phone. The Deposit@Mobile feature, which debuted in August 2009, lets bank customers deposit checks into their checking accounts from anywhere they can get a wireless signal. Using the USAA Mobile App for the iPhone or Android, they snap a picture of the front and back of the check with the cell phone camera and then transmit the images to the bank. The new technology builds on USAA’s Deposit@Home service, developed in 2006, which lets customers scan and deposit checks using their home computer equipment, the company says.

More Banks to Follow with Checking Account Deposit Feature

Other banks are following suit. The New York Times reported in March 2010 that ING Direct plans to introduce a cell phone deposit application later this year, and the Associated Press recently reported Chase, Citibank, and Bank of America also have similar plans in the works.

A 2003 federal law commonly called Check 21 made deposit-by-cell phone possible. Check 21 allowed banks to use digital copies of checks to make transactions rather than waiting on delivery of the physical checks themselves. As a result, checks are processed faster. Digital imaging in Bank of America ATMs, for instance, allows customers to deposit their checks without deposit slips. The ATM makes an instant digital image of the check, flashes it up on the screen, and even prints it out for customers who want copies of the checks as part of their receipts.

From Cell Phone to Checking Account: How it Works

The cell phone technology is similar. The camera phone takes digital images of the front and the back of the check and transmits those to the bank. The bank’s computer system then reads the amount and all the important banking information it needs to make the deposit, such as the routing number, the check writer’s account number, and check number. It also checks the image of the back of the check to verify your signature. The information is encrypted–scrambled to prevent hackers from getting it–during transmission.

Deposit by cell phone is just one more way that banking is becoming more mobile and less dependent on brick-and-mortar branches. As this and other technologies become more available, more options open up to consumers. If you’ve been holding back from looking at online banking because you were worried about limited deposit capabilities, chances are you won’t have that excuse much longer.

About Author
Barbara Marquand has written about personal finance for more than a decade. Prior to that, she wrote for national consumer and trade publications on a wide range of topics, including business, careers, and parenting. Her work has appeared in MarketWatch, MSN Money, USA Today, The Washington Post, and many others.