24 October 2013

Mobile Deposits: Risks and Tips to Even the Playing Field with the Banks

In a previous post at PlzHold, two USAA (@usaa_help) customer service failures were cited. One of these was compounded by a related failure at Citibank (@askciti). Customers at other banks should take note. The gist of this problem is that a bank can wait literally months to reject the scanned image and then demand that you cover the check in five working days or less.

In addition to the convenience factor, mobile deposits are used by some branchless banks and single-facility credit unions which provide this service to customers located anywhere where a wireless service reaches.

It seemed like such a great idea.

If the convenience outweighs the risk for your situation, follow these tips:
  1. Keep the original check. The bank may refuse the scanned image months after the deposit has been initially honored.
  2. For large dollar value checks, don't use the mobile facility at all. The cascading effect of a dishonored check is not worth the convenience.
  3. When offered, use the desktop version instead of the smartphone version. Verify the quality of the scan before sending the check to the bank (see OCR tips below.) Example: Chase Mobile for desktop. Not all banks offer this option, which is silly, since the smartphone scans are inferior.
  4. If you have no local branch or ATM that accepts an old school document deposit, have the overnight deposit address for your bank handy so that you can ship the check via Fedex, Express Mail or UPS if the check is dishonored.
  5. Keep your own scan of the check using a full-fledged scanner, not the cheapie in the smartphone. Be certain that the routing number, account number, date, signature and amount are all clearly scanned.
  6. If the check is an important one, use the OCR feature of your scanner software to verify that the key check fields can be read electronically. This won't help with the eDeposit problem, but you will have verified that you have a readable electronic copy of the check.
Keep in mind that two banks are often involved. The originating bank can refuse the check months later, in as the PlzHold blog post, and your bank will simply follow suit.

For some, this change of banking document workflow is new. Cashed checks were scanned by most businesses for record-keeping purposes, but the scan quality was less important. Now the physical document itself must be kept. 

And you thought smartphone deposits were so high tech. 

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