2011 RDC Summit - Mobile RDC and Credit Unions

While at the RDC Summit 2011, I had the opportunity to attend two sessions, in the Credit Union Track, on Mobile Remote Deposit Capture.  While the two credit unions presented in different sessions, a few common themes stood out among the presenting institutions: Mobile RDC is not as risky as you might think and RDC can have a big impact on the FI.   Tony Rasmussen from Mountain American Credit Union (MACU) presented in the “Mobile RDC for Credit Unions” session and Mary O’Rourke from Randolph Brooks Federal Credit Union (RBFCU) presented in the “Mobile & Consumer Capture Case Studies” session.

When an FI thinks of using a mobile device for banking, skepticism and fear of fraud can easily creep in. The primary fear is that a customer will try to deposit fraudulent checks or make multiple deposits.  Both CUs demonstrated that though KYC (Knowing Your Customer), you can mitigate the risk of fraud.  In fact, since launch, MACU had not seen any fraud and RBFCU had only one incident of fraud, resulting in an $800 loss.  So how did they achieve this? Both had processes in place that allowed them to place deposit limits on their customers and to implement systems that scanned for “out of the ordinary” or irregular transactions.  But they also ramped up slowly and had reviews in place that allowed them, over time, to raise deposit limits as requested by their customers.   Today, MACU reviews only 1% of the checks that are deposited using Mobile RDC.  While fraud is one of the most talked about issues in RDC, the presenters said that with the right checks in place, fraud is as big an issue as everyone thinks.

Now that fraud has been addressed, what does having a mobile RDC product mean to the FI?  When you look at the demographics of the mobile customer, they are young, internet savvy and smart phone wielding.  MACU demonstrated that while the typical Mobile Deposit User is younger than their overall membership, they are 185% more profitable.  Yes, the mobile customer, while younger can be more profitable. 

So how did the CU’s attract this young, profitable segment?  They offered mobile deposit for free and adoption took off.  Both had similar launch stories.  They offered an iPhone app and did little or no marketing initially.  Within  hours, they had their first downloads.   This also allowed each FI to “beta” mobile RDC with the early adopters.   Once the CU’s were comfortable that their mobile RDC product was running smoothly, they launched their marketing campaigns.  Three months after introducing mobile RDC to their customer base, each institution was receiving over $1MM in monthly deposits. 
MACU’s mobile RDC product is only three months old, but RBFCU has had their product for over a year and today, they boast over 70,000 smart phone app downloads, split roughly even between iPhones and Android phones.  RBFCU has had such success with their Mobile RDC product that they are removing RDC from their ATM units, resulting in cost savings for the CU.

The bottom line is, why isn’t every FI scrambling to roll out mobile RDC?

To view the presentations, please visit the 2011 RDC Summit Presentation download section of the Forums.  Registration and Login is required to view and download the presentations:

• Mountain America Credit Unions:  “Mobile RDC for Credit Unions”
• Randolph Brooks Federal Credit Union: “Mobile and Consumer Capture Case Studies”

Lui King
COO, RemoteDepositCapture.com