Why does it have to be an iphone? Why not mail in a picture from any mail client that supports gpg encryption?
A US bank will this week launch a new service that allows you to deposit checks by taking photos of them with your iPhone. The privately held financial services and insurance company USAA (United Services Automobile Association) serves only current and former members of the US Armed Services and their families, but even with …
The US has some creative cheque processing. In a lot of places if you write a physical cheque they will scan it for the relevant numbers and send the information off, the banks then immediately transfer the money like a debit transaction. They then turn around and hand the cheque right back to you. Granted, I mostly ran across it when I was down in the whole Florida/Alabama area, but I don't think scanning the cheque visually via camera will be much worse then what they do to pull the numbers off it now.
Yeah - Walmart does this with all checks. If you think about it, it saves on bad checks. (and where better to have bad checks but wally-mart and the southern US.) The company is in effect making sure that your check is GOOD while you are in line and they can still take back the groceries/shoes/ipod/saw blades/etc. It may be a bit on the Orwellian but likely it makes good business sense.
I haven't worked retail in years (instant check checking schemes were just starting to come on line back then), but I believe Owen's experience is the norm with any of the national retailers from what I see when others write checks.
Most of the large retailers will print the check for you -- hand them a blank one, they run it through the printer, you sign. Even if they keep the physical check, while you were signing the system was getting authorization and putting a hold on the appropriate funds.
Gas station debit card readers work similiarily -- they typically check your account when you swipe the card to make sure there's $75 in there. Then you pump. For a while (maybe overnight) there's a $75 hold on your account until they post the actual amount as part of a bulk transaction overnight which goes to MasterCard / Visa, who then send it to your bank, at that point the $75 hold is removed and the exact charge substituted.
They have direct debit over here too under various names (auto-draft, auto-pay, etc) but only a mad man would sign up for it. There's no customer-side guarantee as with UK direct debit, no requirement for a notification/waiting period before a payment can be drawn and no restrictions on the amounts drawn either. By signing up for it, your basically handing the company concerned Carte Blanche to your money and your chances of a speedy resolution if (when) they screw up? Slim to nil.
That, combined with the fact that several of my utility companies charge horrific 'convenience charges' to pay online or by phone (mortgage: $10/payment; electric: $4/payment), that is why I still use cheques!
I think in my 6 or 7 adult years in Blighty, I wrote about 5 cheques. Since I moved Stateside a year ago, I must've written 50 or more.
What I mean is that everyone has the ability to use non paper based payment and/or cash. Debit cards at the shops, direct debit for services. It's pretty rare for people to use cheques in the UK, in fact many shops refuse to take cheques as they are slow and fairly trivially forgeable. It's also almost unheard of for a shop or business not to be able to take an electronic payment.
There is a reason that most of the cloned cards from the UK end up being used in the USA and that's becuase the banks there won't put the funding into more modern, more secure systems like chip and pin, hanging on to cheques is a symptom of this.
This would be a God send for me, as a business customer to banks..
Every fucking day I have to stand in a massive queue, with multiple deposit slips filled out for bank cheques, sent to me from customers, both in the UK and in the Euro zone, because they do not support BACS, and I can't afford the bank charges to setup Direct Debits as the reciever.
Now, if I could sit at my desk (if I'm doing paper work) or in my van (if I'm on the road), scan/photo the cheques, and then rip them up after a confirmation, then I'd be well happy...
PRIVATE cheques are dead.. business cheques are very much alive (the best ones come from the American Embassy.. possibly the most impressive envelope I've ever seen)...
It's because of Luddites. Some Americans are more afraid of wire fraud than of check fraud. Most checks are sequentially numbered (I know personal checks and business drafts are numbered), and about the only way to avoid an out-of-order check writing is to steal the actual book...and an out-of-order check (or worse, a reused number) always generates a red flag with the bank/accounting department. Plus there's the paper trail. Some people just don't feel safe without something to hold, read, and verify. It's the same with bills.
Now, direct debits have their advantages. You save on the cost of checks and you can have an easier time balancing the books. Thing is, credit card companies sometimes charge up the wazoo for their services. Many small firms won't sign up because of these fees, and even the big boys are crying foul over oligopoly strongarm tactics.
Someone in the UK made a cheque out of their underpants apparently, as long as the cheque was made out with the correct numbers it had to be accepted, I doubt it would work anymore, what with all this extra gubbins flying about, chip and pin, DD and that.
I don't think I'd have been happy accepting someone's grundies for petrol or whatever.
I still need to use cheques very occasionally since there are still occasional times where I can't use card or electronic payments - but the only times these days is if I'm putting one inside a birthday card or paying someone personally and there isn't a cash machine nearby. Sure, I could use bank transfer but Barclays no longer let you pay someone new unless they're a business without switching to their pinsentry system.
>What I mean is that everyone has the ability to use non paper based payment and/or cash.
Town will only take checks for paying property taxes.
DMV in my state only accepts checks or cash in person. Checks if renewing by mail. Neither the town or state want to lose revenue to merchant fees, and they have pretty big hammers to hit you with if you're dumb enough to bounce a check to them.
That said, almost all commercial businesses take both credit and debit cards, generally preferring debit since the merchant fees are lower.
There remain reasons to accept checks, however. The big one is most debit cards are limited to $500 per day. Any big tickets or a modest shopping spree either require multiple cards, putting it on a credit card if you have one, or writing a check.
In the UK the banks also have some creative techniques...
Generally this involved the money leaving your account the moment the cheque is presented, it then sits in the banks account for a few days earning interest, then eventually a couple of days later it appear in the account of whoever you wrote the cheque to.
So, what's to stop someone making high-res scan of a legit check, Photoshopping it to add a few hundreds (in words and numbers, easily done), then 'cashing' it via a relatively low-res camera-phone. Printers spent a lot of effort designing checks that would resist tampering, but if the bank is ready to accept crappy low-res camera-phone pics, then surely there's a whole load of dodginess just waiting to be exploited.
Take a step over to the continent. There ain't no such animal as a cheque. Everything is either giro-stylie or electronic. Phone banking (SMS payment) is common in central europe and internet is ubiquitous. One of the very odd things is the balkanisation of Debit cards. These quite often cannot be used cross-border, even though they bear a Visa or Maestro symbol. This means there's still a heck of a lot done in cash.......
"Someone in the UK made a cheque out of their underpants apparently, as long as the cheque was made out with the correct numbers it had to be accepted"
I've always thought that to be an urban myth... Certainly when I was at uni in the early 90s someone I knew tried giving a cheque for the rent to his friend written on a cornflake packet, and the bank rejected it as not being a proper cheque. I didn't see it so can't comment on whether it had all the numbers correct and legible, but they claimed they'd done it properly..
You can still write a cheque on whatever you like in the UK, and the banks will still accept them (they have to as all a cheque is a written instruction from you to your bank to pay someone from your account) but expect to be charged £stupid_amount by the bank as a "non-standard cheque processing fee" for the privilege.
I spent 3 years in the US 98-00 and even at that time I rarely used cheques in the UK so was somewhat surprised when I opened a bank account in the US to receive in the post a box containing something like 10 check books each containinbg 20 checks - my initial reaction was how long would it take to use these. Then I discovered that 8every* month I needed to write checks to electricity company, gas company, cable company, refuse collection company, water company, car lease company, local phone company, long distance phone company ... so they started to go quite quickly. However, during that time the banks "invented" (n.b. US banks were constantly "inventing" new ideas that had been standard in the UK for a decade or so) the idea of automated regular payaments aka direct debits so eventually the rate of check usage did decline!
One thing to remember about US checks is that they don't have a check guarantee card which means that shops can be more selective about accepting checks (signs saying checks not accepted from out of state banks were common and I even saw ones saying checks from out of county banks not accepted) but at the same time the absence of a £50/£100 guarantee limit means checks were accepted for sums that no UK shop would have accepted.
Anyway, now back in the UK for me, like others above, checks are almost redundant - I never carry a cheque book around with me and they now seem only to get used for sending money to childrens schools for dinner money etc!
As much as DD has a client guarantee, it means absolutely nothing if the DD was set up by one of their 'trusted entities' or whatever they call them... after all, YOU must've given THEM your details. No verification whatsoever.
So I am stuck with paying 3 quid or whatever to BT and others who insist on DD for payment. For me that's a safer deal than the cost of dealing with the headache of their screwups.
What'll you stop you? The original check writer crying foul, since they probably still hold the stub/carbon/e-record that says exactly the original amount they originally wrote on the check. If their funds get overdrawn, they can call their bank, get an acccount history, and if one of the amounts don't match, they can come back with the stub/carbon/e-record and yell, "Hey! That guy's defrauding me!" You can probably expect a visit from the bunko cops soon after that's discovered...oh, and a transaction correction to boot.
Anyway, I don't think USAA is stupid. They're not allowing EVERYONE to use the system--just those in good standing.
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