iPhone App: USAA lets users deposit paper checks via cell phone

Mobile banking apps are pretty ubiquitous these days. Customers have long been able to look up balances, transfer funds, and even send money on the fly. But even with those services, something key has still been missing from the wireless banking feature set.

They can’t handle that birthday check from Grandma or the mobile phone rebate that FINALLY arrived. Not that you’re complaining — paper money is better than no money — but not having to haul butt to the local branch or ATM to deposit checks sure would be swell.

Well, there’s at least one bank that’s got its eye on the future.

A privately held bank called USAA will unveil a new feature for its iPhone app this week that lets users deposit a check by snapping and sending pics of it. The user photographs both sides using the phone’s built-in camera and sends the images to the bank, which processes it like a normal deposit.



The whole system is electronic, which means customers won’t have to mail anything — neither deposit slip nor check. (To mitigate the risk of fraud, customers must be eligible for credit and carry some form of USAA insurance to use the feature.)

USAA has just one branch in San Antonio and serves mostly military personnel, so this app may not be a major game changer for a majority of banking consumers. It does, however, herald some things that, if widely adopted, could change the way we all deal with our money in the future. If other banks jump on board, the cell phone in our pockets would basically become portable banking branches.

This is extremely practical, especially for small business customers.  But I have just a pesky concern: Checks have validation marks for security reasons. It seems like these would be out the window in a completely digital transmission process. (And let’s face it — the cameras on most mobile phones are nothing to write home about. If mobile deposits become widespread, could a basic set of photoshop skills turn any graphic designer into a would-be forger?)

So let me ask you: Do you think more banking institutions should follow suit and implement this kind of innovative feature? Or would security concerns prevent you from using this? Sound off below.

(For the record, I’m torn, so my answers are both “yes” and “yes,” for now.)

Here’s a preview from the bank on this new mobile deposit feature, as seen in a recent vid. It’s only for the iPhone for now, but USAA plans to offer on other phones later on.




[via NYT]