Two apps are better than one at least for now when it comes to launching mobile check deposit services, some banks say.
Smaller banks are seeking to capitalize on the attention bigger ones like JPMorgan Chase & Co. and USAA Federal Savings Bank have generated for mobile deposit, but to get the function out in a timely way, they are finding, an integrated experience may not be possible.
Adding the capability to an existing mobile banking app that lets a customer check balances and pay bills can involve months of integration work, even if the services are all coming from the same vendor. The complexity is prompting some banks to release a separate app solely for remote deposit capture.
"We wanted to be one of the first, if not the first, in our footprints" to offer mobile capture, said Alex Jimenez, a senior vice president and the director of deposit operations and alternative delivery at Rockland Trust Co. in Massachusetts.
The $4.7 billion-asset unit of Independent Bank Corp. released a stand-alone app in January for Apple Inc.'s iPhone and iPod touch called Rockland Trust mDeposit; it lets people deposit checks by taking pictures of them.
The feature is separate from the more conventional banking app that the Rockland, Mass., bank released last week for use on the Apple devices, as well as for Research In Motion Ltd.'s BlackBerry devices and phones running on Google Inc.'s Android operating system.
"It will be part of our overall mobile banking app, but it's going to be introduced some time later this year," Jimenez said, "and we wanted to have it quicker than that."
Rockland is not alone. A small number of banks have also released apps solely for check deposit, and several vendors said that they expect this group to grow while they complete technical work needed for banks to offer the capability as part of a full-feature app.
Teresa Epperson, who studies mobile banking trends as a partner at Mercatus LLC in Boston, said she is not surprised that a "speed-to-market" mentality is driving banks' decision-making right now.
"Banks like Rockland Trust are seeing the interest from their customers," Epperson said. "They see the opportunity in the marketplace today to get out there with mobile capabilities, and mobile RDC is probably the best example of a really tangible mobile offering that can add tremendous convenience to interacting with one's bank."
Epperson added that smaller banks and credit unions, especially, have a window of opportunity to attract customers because few banks offer mobile check deposit.
Douglas Brown, the senior vice president of mobile financial services at the Jacksonville, Fla., vendor Fidelity National Information Services Inc., which worked with Rockland on all its apps, said, "Our go-to-market approach here is to make remote deposit capture available right now as an application that can be run in a stand-alone model."
He added that later in the first quarter FIS will have integrated remote deposit capture into the mobile platform it offers to banks.
Epperson said that, in the long term, consumers will look for a more integrated mobile banking experience, which means banks must work with their vendors to combine the features into a single app.
Banks risk confusing customers by taking a dual approach. For example, Rockland's mDeposit software requires separate log-in credentials from its other iPhone app.
"It's not as desirable to have that fractured experience, but if you were a financial institution that was trying to brand yourself as an innovator and you see a potential hit in mobile remote deposit capture, time is money," said Mark Schwanhausser, a senior analyst at Javelin Strategy and Research in Pleasanton, Calif.
The mobile banking vendor mFoundry Inc., which worked with Rockland on its mobile banking apps but not its mobile remote deposit app, has seen a lot of demand from smaller banks and credit unions that want to release stand-alone mobile check deposit apps, said Drew Sievers, the Larkspur, Calif., company's chief executive, with the ultimate goal being addition of the service to more traditional mobile banking apps.
"In general, it's always better to have a single application, a single place, for your customer base to go," Sievers said.
For banks that have no mobile banking apps, going with a mobile RDC app is quicker because it requires less back-end integration, he said.
"With remote deposit capture, you don't have to integrate into a core system, a bill-pay system, a find-an-ATM system, a peer-to-peer [payments] system all of those different systems that mobile banking encompasses," Sievers said.
The challenge for vendors offering mobile deposit platforms is also the need to integrate with other third-party mobile banking software their clients may be using.
"That's not trivial to have parties come together and actually provide that integration," said Gary Brand, the director of source capture optimization at the Brookfield, Wis., vendor Fiserv Inc. "In some cases it's timely, and in some cases, there's a lot of custom code that might have to be written."
Fiserv has worked with banks on releasing stand-alone mobile deposit apps and is doing integration work on its own mobile banking platforms to enable the offering of comprehensive services this year, Brand said.
This work can also require a significant financial-institution investment, he added.
There are also some scenarios in which a dual approach may be more beneficial, Brand said. For instance, small businesses may want their employees to have the ability to deposit checks but without access to full account data.
