PayPal Offers Remote Check Deposit on iPhone and Android Devices

PayPal announced today that you can now deposit checks in your PayPal account via photo upload from both Apple iOS [iTunes] and Android OS devices. Just sign the back of the check, take a picture of the front and back, type in the amount, and submit. (If you have a iPod Touch, iPad, or Android tablet with camera, that works too.) You are free to withdraw the funds into your linked bank account. Via MobileCrunch.

This is pretty cool, as it basically allows remote deposit of checks into any bank, not just Chase or USAA. Reading through the Terms & Conditions, you are limited to total deposits of $1,000 per day, and $3000 per month. You’re supposed to keep the check for 15 days to verify that it went through, and then destroy the check.

The only thing to consider is do you trust PayPal? Long-time readers may know that I have an uneasy relationship with PayPal. They’ve frozen my seller accounts before with no evidence and required all my personal information (SSN, credit report, driver’s license, utility bills) to release the money, and they’ve never been known for their stellar customer service. But I still use them when the alternatives are too inconvenient and the dollar amounts are small, because honestly I’m too lazy (and like I said, they already have my info). I simply operate on the principle that they can freeze my account again at any time, so I never leave more than $20 in my account. I’ll definitely try this app out the next time I get a small check to deposit, but only for small deposits that I’d be too lazy to deposit at a branch and it will be withdrawn immediately.

Comments

  1. Money Beagle says:

    It’s somewhat annoying that they don’t have this for BlackBerry as well.

  2. Mike Hardin says:

    I was so excited about this when I saw your post. I’ve had a $100 check in my truck that I keep forgetting to take by the bank and deposit. I downloaded the app, and when I got to the truck tried to use my phone to deposit it. I thought I wouldn’t even transfer the money out, I’d just leave it there to support the wife’s ebay shopping habit.

    I was sorely disappointed. I tried three times to deposit it, and all three times it said the deposit failed because the check could not be read. The pictures were clear and legible. After the third time I finally made that trip to the bank’s drive through window.

  3. PayPal holds checks deposited this way for at least 5-6 days despite the fact that this type of deposit is covered under Check 21.

    They can do this because they are not a bank so therefore they are not subject to the same rules.

    USAA’s EasyDeposit at any UPS store is available to any member and unless there is an issue the check is cleared immediately.

    Huge difference.

  4. Kim Herbel says:

    I really like this idea, though I agree about paypal not being my favorite option. I will be happy when ING Direct offers this. (they don’t yet, do they?)

  5. PayPal has frozen thousands of dollars of mine multiple times with no explanation or appeal process. Then, after a random amount of time, the account was unfrozen. I will never use or trust PayPal for anything, especially not my money.

  6. I am not a fan of Paypal as well. I have seen a few commercials regarding this technology from other banks so it is just a matter of time before all the banks offer this. I will deposit my check through the ATM for now until this feature is released by my bank.

  7. @Mike – Sorry to hear that, but thanks for sharing your experiences. I didn’t have any checks handy to try out the app myself. Paypal says over a million dollars a day is deposited via their app.

    @Bob – Good point, the fact that PayPal continues to escape regulation as a bank and gets to play by their own rules should throw up warning signs.

  8. @plin – Agreed, it’s only a matter of time. I just wish they would hurry it up. :) Some company needs to make nice standardized package, every bank doesn’t need to reinvent the wheel.

  9. Hey at least with this method you still have the check in your hands. The newer image deposit ATMs which take the check or cash w/o an envelope have from time to time just eaten the check. Now what – you have no check – no way to cancel the transaction and deposit or cash it traditionally.

  10. I’ll wait till Perkstreet Financial has this feature. :)

  11. Alexandria says:

    I am not a fan of PayPal either.

    Thankfully, my credit union accepts scanned deposits. I am sure this will be the norm very soon.

  12. Clark Howard had a caller who had a problem with frozen money. They have an appeal process but finding out about it was hard for him to track down. I think you have to go through arbitration. The guy who had issues finally took matters into his own hands and worked everything out with the buyer. He issued a refund to the buyer who then sent him the money privately. Paypal sucks for this.

  13. Lucknow says:

    Why go through all the hassle since Alliant CU had remote deposit with no hold for ever.

  14. @Robert – They have an appeals process for standard eBay buyer – seller conflicts, but if they choose to freeze your money for other reasons, there is no appeal possible. Any number you call or e-mail you send will only result in PayPal telling you someone higher up (who has no phone or e-mail) will decide the fate of your money at the time of their choosing, and you will not receive notification of what they decide, nor when it happens. This happened to me when I sold a PS3 when they first released (happened to thousands of people with no individual reasons, just PayPal didn’t know how to stop fraud so they just stopped everything), and another time I bought something using Bing’s cash back and had my entire account (thousands of dollars) frozen for about a month.

  15. Brent212 says:

    ETrade froze my account once and wouldn’t tell me why until I finally got through to someone after about 5 calls. Something about me logging in from my work computer caused them to think there was “suspicious activity” going on. I was still able to deposit, of course, but all withdrawals failed.

    I had just opened the account, and was still exploring other savings account options, so I had no desire to stick with etrade, and tried to just close my account so the balance would be sent to me as a check. I thought I would at least be able to do that… I mean they just have to send the money in the account to the person and address that it was opened and funded with… I don’t see how that could be remotely dangerous. But they refused until I verified I was myself, by going to a notary and getting a letter notarized saying that I was me, I lived at the address on the account, and I wanted the account activated.

    What’s with all the security questions and other identify verification info? Couldn’t I have simply given them everything over the phone… all the security question answers, my account password, my account #, my social, passport #, my name, address, phone #, date of birth, past addresses, favorite color, etc???? Jesus…

    SUPER annoying. Especially because this was right after being laid off, when I was considering starting my own business and might have needed to have quick access to that money, which was most of my savings, since, after testing it with a few small transfers back and forth between etrade and my checking, I had just gone on to put most of what I had into it. Luckily I didn’t need it, but it was frustrating regardless, and I was blown away that a bank could let me open an account, fund it, and then freeze it and refuse access to it (or even the ability to close it!) until I jumped through hoops to prove something that I can’t understand how it wasn’t already proven.

    Still trying to figure out what they could prevent by this process. I guess I could have opened the account, and funded it with someone else’s stolen account info… but then me sending in a letter saying I’m me doesn’t resolve any fraud going on there. Or maybe someone else could have opened an account in my name but with their address, funded it with my stolen checking account info. But then they’d end up with a check made out to me, so… And if they had my checking account info, why not just directly access that? F**king etrade…

  16. In three years 83% of all banks will have remote deposit capture. I read that in a banking industry report.

    Most banks are using software created by vendors that is somewhat customized for that bank. Mitek Systems is one of the software companies.

  17. chris d says:

    Is it really that hard or inconvenient to go to the bank. I live in the middle of nowhere. East jabib if you knbow what I mean. just 6 miles from me there are 8 banks. 2 Belonging to the one I bank in. 2 belonging to another institution. And 4 others. I may be a sinic but I will wait a day for checks to clear at chase before doing any of this crap.

  18. Drdomore says:

    Ipad2 has an app from chase that does this

  19. Same experience with PayPal. Will never use the crooks for more than $20 at a time.

    Yes, it really is that hard to go to the bank sometimes, like when you are out of the country for long periods of time. People can still send me checks and I can do remote deposit. But making it an iphone or Android app isn’t useful. Some banks already have remote deposit set up to do online with your scanner and an internet connection. I asked Citibank about it and they said they would have it for personal accounts in Q2 this year (already available for business accounts). So I’m hoping.

  20. I just tried this with a rebate check, and it accepted it so far. We’ll see how it goes.

  21. PNC now has mobile deposit with their iOS App. I just tried it the other day.

  22. paypal application has serious bugs…fails everytime… tried over 20x in various lighting and distances.
    paypal app screws up camera settings…sets cam to 1 megapixel when taking check photos…overriding the camera settings! nothing will look clear at 1mp! jeez … fix the bug paypal.
    phone: motorola xprt (motorola’s business phone)

  23. I wish ING would get this too. I was nervous about the whole Capital One thing and opened an account with Ally to save ATM fees as well as getting this feature. Ally has several problems with their bill pay system I won’t go into on this thread, but the requirement of the long endorsement is kind of a deal breaker for me. I need it to be sign and scan. Is there any online place anyone can probably get that takes scanned checks, as another reason getting to the bank can be hard is if most all the banks in a town close by 4 pm, some 3.

  24. Kelvin Tran says:

    Paypal is suck. I never use it again. It didn’t protect you as debit card fraud. You have to submit a long list forms and wait forever. I never use paypal again

  25. This little trick is saving me considerable money. Thanks to federal regulations, I can’t deposit checks made out to my DBA into my personal bank account, so I have to open a business checking account–which is expensive. Most banks charge service fees of at least $10-15 per month unless you keep a substantial balance in the account. Since I have a business account with PayPal, though, I can use the PayPal app on my phone to deposit checks immediately, and only lose the small transaction fee. We have a winnah!

  26. Is this free? Does PayPal take a percentage or a fee when transferring the amount deposited from the check into your PayPal account and/or when then transferring it to your bank’s checking or savings account?

  27. ThePageHouseShop says:

    i just tried and it worked!

  28. I have been using Pay pal for years business and personal, I did have one problem with one check and it wouldn’t take the dang thing. But that was one check, I Have deposited several checks into my account, I will say I HATE THE 6 DAY HOLD !! There is no reason for this, they no the check clears in 3 days.. But then again my etrade account holds checks for 5 days but it’s 5 days not 6 … For this reason I have ran to the bank to deposit checks it’s just not worth the wait time for me, specially when I use the money for business reasons.. I have now opened a business checking and much happier I don’t use paypal much, But paypal has 1% cash back on there card which is very nice. Its ok, and I do like paypal for invoices and also for online shopping.

Speak Your Mind

*