Home > Electronic Funds Transfer (EFT), Technology & Telecom > Deposit a Check Using Your Cell Phone?

Deposit a Check Using Your Cell Phone?

In the not-too-distant future, people will be able to deposit checks using their mobile devices.

All a user will have to do is snap a picture of the front and back of the check and send the image to their bank.

Paving the way for this miraculous feat of technology is the Check 21 law which Congress passed in 2003. The law was passed because, immediately following the 9-11 terrorist attacks, the banking industry practically came to a standstill, due to the fact that all planes were grounded and paper checks and documentation could not be sent between banks and financial institutions in a timely manner. An electronic alternative needed to be put in place.

But development of technology that enables “digital checks” to be sent from mobile devices to banks has been slow in the making – and equally slow to gain traction with consumers.

According to an AP report published today, however, that is soon going to change. Software vendors are now developing mobile applications that will allow users to take digital images of checks and securely send them across wireless networks. Apple has already developed such an application for its iPhone and USAA, which provides insurance and banking for military personnel and their families, has also developed a similar application for mobile devices. Chase, Bank of America and Citibank are planning to release similar applications this year, the AP report states.

According to the report, the digital image simply provides the bank with the information it needs to complete a deposit – the check routing number, account number, amount of deposit and customer identification data (name, address, phone number, etc).

The reason this was slow in the coming is because the technology had to overcome some initial hurdles. For example the applications that make digital check processing possible had to be designed in such a way that no images or check information are left behind on the user’s mobile device. In addition, the digital check services that the banks offer to their customers must offer strong encryption so that digital checks cannot be intercepted by hackers for fraud purposes.

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