Expert Interview with Ann Reichert on Digital Check Processing

Ann Reichert is the director of marketing for Mitek. If you've ever cashed a check by taking a photo of it, Mitek's processes were probably involved. Ann was kind enough to break down for us how the process works, and what we should know about the security of your money online.

How exactly does a photo of a check get deposited into a bank account?

Here's process for a typical mobile remote deposit capture (MRDC):

  • Take a photo of the front and back of a check.
  • The check goes through quality check to meet Check 21 standards.
  • It is passed through real-time fraud and risk screening.
  • An electronic file is created and sent to Federal Reserve for clearing.
  • Like with a paper check, the electronic check then goes through the same batch processing.
  • At the Federal Reserve, the bank account is debited and funds are sent to the payee's financial institution.

What do you believe are the advantages of mobile banking?

Mobile banking offers customer multiple advantages, the most obvious, of course, being convenience. Consumers have anytime, anywhere access to their account to check balances, transfer funds, deposit checks, pay bills and more. All without using a computer to connect to the internet and without going to the branch.

Mobile banking is also more secure than online banking due to the security inherit to the mobile device. For example, mobile offers multi-factor authentication, which online banking does not. Mobile devices carry a unique device ID which can be used to monitor customer, device, and account information at the carrier level. Additionally, most smartphones are equipped with geolocation, which can be used to track the physical location of the device. If a mobile deposit is attempted from an unusual location, the bank, credit union or financial services provider can flag the transaction and contact the customer to determine if it was indeed them who made the deposit. Finally, many mobile devices and apps are using biometric authentication as an extra security measure. Everyone with an iPhone 5s has the option to use a fingerprint identity sensor instead of PIN to access their phone.

What are some of the "back room" issues that customers may not notice with mobile banking?

Even though most of the transactions takes place electronically, in some cases the checks are reviewed by humans to make sure the numerical amount, the written amount and the amount of the actual mobile deposit all match.

There are also various fraud and risk assessments made to protect customers - if potential fraud is detected, the customer is contacted via SMS, email, a phone call or other means.

What would you say to someone concerned about security?

One common security question customers often ask is "What happens to the image of the check after the picture is taken?" Actually, the image of the check does not stay on the phone, so there is no danger of the image being taken from the device.

As mentioned earlier, several of the advantages of mobile banking are the unique features that also make it more secure: app login, mobile authentication, device insight and location.

Where do you see mobile banking heading in the next few years?

Many Gen X and Gen Y consumers are moving from a "mobile-first" mindset to "mobile-only," so banks and credit unions will want to invest more in mobile services designed specifically for the device. Native apps will have even more functionality. Consumers will be opening accounts by downloading apps for enrollment that offer a simple transition to mobile banking once application process is complete.

Want the latest on RDC? Keep up with Ann on Twitter.