By Mitch Lipka
(Reuters) - If you are looking for a way to rebel against big banks, you could just sit on your couch and scan a few checks.
How is that making a statement? Once you can easily scan a check and deposit it, do you really need to stick with a bank just because it has a branch in your neighborhood? The technological advance of smartphone scanning breaks down one of the last barriers to easy bank switching. As the practice spreads, there may be no stopping upstarts from cutting into the deposits of major banks.
The idea of switching out of big banks to smaller ones has morphed into its very own day: November 5 is Bank Transfer Day (see www.facebook.com/NovemberFifth). It was launched by Los Angeles art gallery owner Kristen Christian to encourage folks to pull their money from big banks in protest of their policies, from mortgage lending practices to the repayment of TARP funds to a constant array of new fees.
"Seriously, who likes going to branches? It's much more convenient to either mail checks or use cutting-edge mobile deposit technology," asks former Capital One executive Dan O'Malley, who is now CEO of PerkStreet Financial, one such small financial institution.
Mailing checks for deposit to operations like PerkStreet, State Farm Bank, ING Direct or a distant credit union has long been an option, but the growth and acceptance of deposit by phone could be a game-changer for many consumers, O'Malley and others say. USAA Bank has been accepting scanned check deposits for years. It caters to mobile military families but also offers banking services to the general public,
"In addition to reducing costs associated with mailing checks, mobile-based remote deposit makes it infinitely more convenient for customers to get money into their online-only accounts at branchless banks," O'Malley says.
Security experts say there is no particular concern to making deposits via a smart phone app. The main issue is being sure to take basic precautions with your phone, says Joseph Steinberg, CEO of the IT firm Green Armor Solutions. "You should have security software on your smartphone. You should have the capabilities to do an anti-malware check," Steinberg says.
Of course, using a phone to deposit a check isn't exclusive to upstarts. In addition to USAA Bank, which has but a handful of locations, big banks including JPMorgan Chase have since joined in.
Brian Ruby of Stratford, Connecticut, uses the Chase app. "It's very easy: endorse the check, launch the app, snap a couple pictures, confirm the numbers, wait for an email saying it's good and shred it," he says. "I don't get checks very often, and when I would they would sit around for a long time since I seldom visit a branch, so now I'm much quicker on deposits."
Depositing a check by mail is riskier scenario than a deposit by phone app, Steinberg says.
Online banking through remote Internet-based financial institutions isn't new, but is growing with deposit technology. At State Farm Bank, mobile check deposits are up 150 percent since January. Customers using the technology run the age gamut -- nearly 45 percent of mobile check deposit customers are 36- to 55-years-old, the company says.
In case you're concerned about the security of your online bank, check to see if your funds will be FDIC insured. State Farm, PerkStreet (through Bancorp Bank) and ING, for example, all are FDIC members.
Being a revolutionary is one thing. But doing without that government deposit guarantee? That's revolting in a different way.
The author is a Reuters contributor. The opinions expressed are his own.
(Editing by Lauren Young and Beth Gladstone)
Copyright 2011 Thomson Reuters. Click for Restrictions.
Our 2024 Coverage Needs You
It's Another Trump-Biden Showdown — And We Need Your Help
The Future Of Democracy Is At Stake
Our 2024 Coverage Needs You
Your Loyalty Means The World To Us
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
The 2024 election is heating up, and women's rights, health care, voting rights, and the very future of democracy are all at stake. Donald Trump will face Joe Biden in the most consequential vote of our time. And HuffPost will be there, covering every twist and turn. America's future hangs in the balance. Would you consider contributing to support our journalism and keep it free for all during this critical season?
HuffPost believes news should be accessible to everyone, regardless of their ability to pay for it. We rely on readers like you to help fund our work. Any contribution you can make — even as little as $2 — goes directly toward supporting the impactful journalism that we will continue to produce this year. Thank you for being part of our story.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
It's official: Donald Trump will face Joe Biden this fall in the presidential election. As we face the most consequential presidential election of our time, HuffPost is committed to bringing you up-to-date, accurate news about the 2024 race. While other outlets have retreated behind paywalls, you can trust our news will stay free.
But we can't do it without your help. Reader funding is one of the key ways we support our newsroom. Would you consider making a donation to help fund our news during this critical time? Your contributions are vital to supporting a free press.
Contribute as little as $2 to keep our journalism free and accessible to all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. Would you consider becoming a regular HuffPost contributor?
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. If circumstances have changed since you last contributed, we hope you'll consider contributing to HuffPost once more.
Support HuffPostAlready contributed? Log in to hide these messages.