USAA Pilots Use of Mobile Check Capture to Fund New Accounts

USAA is piloting a mobile feature that lets consumers use their smartphone's embedded camera to photograph blank checks to help build USAA accounts while avoiding manual data entry.

"It's important to have keystroke shortcuts. If someone wants to open an account with us we want to be able to expedite the process," says Andy Collins, a vice president of emerging payments at the San Antonio-based USAA, a member-owned financial institution that offers insurance and banking services to a customer base dominated by military personnel and their families.

These consumers are frequently on the go and in remote locations, leading USAA to adopt new delivery channels earlier than other financial institutions. It was one of the first to have mobile deposit capture, for instance. Its latest technology advance lets users fund a new checking or savings account from another financial institution account by snapping a photo of a blank check. The feature is designed to make new account opening easier.

"It's a great use of mobile technology…it's very easy to 'fat finger' and enter data into touch screens and make a mistake. Using the image helps with accuracy, and it's going to be more convenient as long as it's done in a secure way," says Mary Monahan, a research director for Javelin Strategy & Research.

Mobile banking is available to all USAA account holders, with no need for separate mobile enrollment. The check photo function is aimed at current or new members who are opening a new checking or savings account. The photo captures routing and account numbers from the outside checking account.

"Each check has similar attributes, there's a routing number, an account number and a check number…we can populate the necessary fields from the information that we take from the check," Collins says. The feature is being tested, and will shortly be made more widely available.

There's still some manual work for the consumer. He or she needs to enter the amount of funds they want transferred into the USAA account. And Collins says new members will have to establish membership with USAA and assign a user name and password for online and mobile banking in order to open a checking or savings account through mobile banking. Once the account is opened and the member downloads the iPhone/iPad or Android app, the member is able to sign up for a Quick Logon feature that uses Symantec Validation and ID protection to generate one-time security codes. The "blank check photo" feature is free, and at this time the functionality can only be completed through the new account process on mobile banking.

Analysts say the use case of USAA's pilot is relatively new for the banking industry, and fits with the institution's mobile-heavy posture. "USAA has been very aggressive in pushing mobile adoption," says David Albertazzi, a senior analyst with Aite Group.

USAA, which develops most of its tech in house, also offers mobile RDC as part of a broad suite of mobile financial services. Collins did not discuss specific rollout schedules for future mobile imaging features, but says the institution sees promise in using the technology as part of mortgage processing or to help manage documents for auto and insurance. "To be able to scan an item and then populate various fields inside our own application with that scan, that type of process makes the member experience a whole lot better than trying to type something into a three inch screen," Collins says.