NEW YORK (6/11/14)--Remote-deposit capture (RDC) technology brings physical checks into the digital world but with a risk that still has some credit unions wary.
With 33% of non-cash transactions still occurring via checks, both in-person check-cashing services and RDC are needed by consumers.
According to a recent report from the Center for Financial Services Innovation, duplicate presentment of a check is the significant source of mobile RDC-related fraud.
One of the most common schemes is when a consumer deposits funds with his mobile device and goes almost immediately to a check-cashing service with the same item, the report noted. The mobile RDC channel has more than twice the average rate for returned checks both in the prior two years and past 60 days, according to data provided to CSFI from Certegy.
However, in a survey of nearly 250 financial institutions, 80% reported no losses had occurred due to RDC, according to RemoteDepositCapture.com (May 21).
Availability of funds is one way to control risk, said John Leekley, founder/CEO of RemoteDepositCapture.com. Twenty-eight percent of respondents provide same-day or immediate funds, 51% offer next-day availability, and 16% have a two-day policy.
An additional tool to mitigate fraud is to apply risk ratings to individual deposits based on account size, deposit amount, frequency of deposits, previous fraud incidents and member segmentation, said Leekley (Bank Systems and Technology May 21).