Years ago, as a small business owner, I spent a lot of time waiting for the mailman.
Cash was always tight, and I held out hope that what the mailman delivered would be enough to cover all the checks that had already been mailed. Many of my clients had said the “check was in the mail,” so it was just a matter of time before they arrived.
Back then deposits had to be made before 2 p.m. to be posted that same day and it seemed I was always making a mad dash to the bank as soon as the mailman arrived. Of course those were the days when you had three days of “float”, but that’s a whole ‘nother story.
And for clients that would call and say the check was ready to be picked up, I had a list of every bank branch in town. Time was of the essence and I didn’t have time to search for one.
I was a very happy businessman when local banks started allowing deposits until closing time. This gave me a little extra time to make it to the bank.
I still remember the time that I went to make a deposit in my bank’s ATM and realized I had until 8 p.m. for my deposit to be counted that day. That meant I could work a little more each day before heading off to the bank.
As my business grew and became more profitable I didn’t have to make as many trips to the bank as before. I even had a few clients that used ACH and deposited the money directly into our account.
My wife worked for a state association and was introduced to remote deposit capture a couple of years ago. Of course, in the beginning there were a lot of bugs to be worked out, but it was still easier than running to the bank.
And then it happened. A few months ago my bank introduced mobile remote deposit capture. Using my “smart” phone I could take a picture of my checks and deposit them instantly. I could text “last” to my bank to see the last deposits and could text “bal” to see my current balances.
The smart phone has changed the music, publishing and camera industries forever, and the banking industry is next. Banks can now grow market share without the high cost of branches and since their transaction costs have been reduced, their overhead is also reduced. And it’s still a unique selling point for many banks and gives them something new to market.
I spoke at a large state banker’s association last fall and asked how many banks were planning to introduce mobile remote deposit capture this year. Only a handful of bankers raised their hands and several said they would never offer this product. They were afraid of the risks and liabilities. Hopefully these banks will notice how many people live on their smart phones and will sooner than later realize they need to be offering this new technology.
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Neal Reynolds has worked with hundreds of banks and credit unions around the country helping them to grow core deposits and market share without growing their marketing budgets. Contact him at [email protected].
