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What Is a Mobile Deposit?
What Is a Mobile Deposit?
Mobile deposit, also known as mobile check deposit, is a digital way to deposit paper checks into your checking or savings account using your smartphone or other mobile device, such as a tablet. It’s a safe and secure way to deposit a check without having to trek to your local bank branch or ATM. Plus, you can use mobile deposit 24/7 from anywhere you have cell service or WiFi—though it’s best to avoid online banking on a public WiFi network to keep your information secure.
You can use mobile deposit for most paper checks, including personal checks, business checks, and government-issued checks. If you need to deposit an international check or money order, contact your bank to see whether it allows mobile deposit for these types of checks.
Key Takeaways
- Mobile deposit makes it easy to deposit a check into your bank account using your smartphone or other mobile device.
- To use mobile deposit, you’ll have to endorse the back of the check with your signature and, in some cases, some variation of the phrase “For mobile deposit only.”
- Banks use encryption and security technology to keep your mobile banking information safe, though banking on public WiFi can be risky.
- Funds from a mobile check deposit are usually available in your bank account the next business day.
How Mobile Deposit Works
Mobile check deposit uses remote deposit capture technology to deposit the check funds into your bank account. This tool lets banks accept deposits using electronic images of the front and back of a check instead of requiring the original paper check to be physically deposited at a branch or ATM.
The process of making a mobile deposit can differ between financial institutions, but you’ll typically follow these steps:
- Download your bank’s mobile app and set up your account.
- Look for the “deposit” or “mobile deposit” option.
- Sign the back of your check and write “For mobile deposit only” beneath your signature. Some banks may ask for a slightly different phrase, so check your bank’s requirements before writing on your check.
- Select the account you wish to deposit the check into and fill in the amount (sometimes this is done after the next step).
- Use your device’s camera to take photos of the front and back of the check, ideally on a dark background.
- Review the check details (amount and account) and select the option to deposit the check.
After you’ve submitted your mobile deposit, the app will transmit the information to your bank and you should see a confirmation message. Depending on when you deposit the check, it might take a business day or two for the funds to become available in your account.
It’s a good idea to hold onto your physical check until you see the funds clear in your account. For example, Wells Fargo recommends keeping your check for five days after your mobile deposit.
Pros and Cons of Mobile Deposits
In most cases, the advantages tend to outweigh the disadvantages of mobile check deposits.
Pros
-
Convenience and flexibility
-
Safety and security
-
Fast access to funds
Cons
-
Check could still bounce
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Risky to use on free or public WiFi
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Must endorse the check correctly
Pros
- Convenience and flexibility: Mobile deposit is a convenient way to deposit a check—it works anytime, anywhere you have access to the internet, and you don’t have to go to your bank in person.
- Safety and security: Banks use (or should use) the proper encryption and security technology to keep your information safe.
- Fast access to funds: Most banks can clear your funds by the next business day.
Cons
- Check could still bounce: Even if your banking app confirms that you deposited the check, it’s possible that your bank could reverse the deposit due to insufficient funds in the payer’s account or another issue. You may also be charged a bounced check fee in the process.
- Risky to use on free or public WiFi: Using online banking on a public internet network can make you vulnerable to hackers, who might be able to access your account. It’s a good idea to only use mobile deposit on trusted networks.
- Must endorse the check correctly: Along with signing your name, you’ll have to follow your bank’s rules for correctly endorsing your check. For example, PNC asks you to write “For PNC Mobile Deposit Only” beneath your signature (although these requirements may not always be strictly enforced).
Frequently Asked Questions (FAQs)
Are Mobile Check Deposits Safe?
Mobile check deposits are generally safe, since banks use encryption and security technology to protect your information. However, signing into your banking app on public WiFi could compromise your security, so it’s a good idea to only use mobile deposit on a trusted network.
What Banks Offer Mobile Check Deposit?
Many banks offer mobile check deposit, including Ally Bank, Bank of America, Capital One, Chase, Citibank, Discover, PNC Bank, U.S. Bank, and Wells Fargo.
What Should I Write on the Back of a Check for Mobile Deposit?
You should sign your name on the back of a check—a process known as endorsing the check—before using mobile deposit. Below your signature, you should also write something like “For mobile deposit only.” Depending on your bank’s guidelines, you may be instructed to include the institution’s name.
How Soon Are Funds Available With a Mobile Deposit?
Funds from a mobile check deposit are often available in your bank account the next business day. However, the time it takes a check to clear varies depending on your institution and when you deposit the check. For example, if you deposit a check on a weekend at Wells Fargo, the funds will become available on Tuesday.
What’s the Difference Between Mobile Deposit and ATM Deposit?
Mobile deposit involves depositing a check through your bank’s app on your smartphone or other mobile device. You can use mobile deposit anywhere you have access to the internet.
ATM deposit involves depositing a check in person at one of your bank’s ATMs. When you deposit a check at an ATM, you’ll insert your bank card, enter your personal identification number (PIN), choose the “check deposit” option, and insert your endorsed check into the machine.
The Bottom Line
Mobile deposit is an easy, convenient, and secure way to deposit checks into your bank account without having to visit a bank branch in person. Before depositing a check with your mobile device, look up your bank’s guidelines for endorsing the check so you know what to write on the back under your signature.
Avoid using mobile deposit on public WiFi networks to keep your information secure, and hold onto your check for a few days after depositing it to make sure the transaction clears. As long as you follow these general guidelines, mobile check deposit can be a painless and flexible way to deposit a check into your checking or savings account.
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What To Do If Someone Has Your Bank Account Number
Contact your bank right away and watch out for unauthorized transactions
If someone has your bank account number, you should act fast to prevent or minimize the impact of any potential fraud. Contact your bank right away, review your bank statements for any activity you don’t recognize, and check your credit reports.
Key Takeaways
- After you discover someone has your bank account number, contact your bank as soon as possible.
- If someone has your bank account number, they may be able to steal your money.
- Thieves can acquire your bank account number in several ways, such as by directing you to click on a link they send in an email or text message.
- Consider signing up for paperless statements so scammers can’t steal your bank statements from your mail.
What To Do Right Now If Someone Has Your Bank Account Number
Here are the steps to take right now if someone has gained access to your bank account number.
Review Your Bank Statements
Log in to your online account and check your recent banking activity. Are there any transactions that don’t look familiar or that you don’t remember making? These unauthorized charges might be the work of an online scammer who has your bank account number.
Contact Your Bank
Contact your bank or credit union immediately to let a customer service representative know that someone obtained your bank account number. This is especially important to do if you see suspicious activity—such as a check that you didn’t write—in your account. You should do this within 60 days of the statement showing the fraud, or you may be held liable for further fraudulent charges, although it’s still worth reporting fraud whenever it’s discovered.
If you believe somebody made an unauthorized transaction using your bank account information, request that the transaction be reversed and your money be returned.
Once you report an unauthorized transaction, your financial institution typically has 10 business days to look into it. If the bank finds that your complaint is legitimate, it must fix the situation within one business day of determining the complaint was legitimate. The bank must then share the findings of its investigation with you within three business days.
Federal law might offer you extra protection if an unauthorized transaction was made through an electronic funds transfer (such as an online bill payment) or with a debit card.
Consider Closing the Account
If someone has obtained unauthorized access to your bank account number, ask your financial institution to close your bank account and open a new one. Teri Williams, president and chief operating officer of OneUnited Bank, offered further points of advice.
Once you’ve closed the account, Williams recommends freezing your credit reports. Freezing your credit reports prevents creditors from accessing your credit file and prevents anyone from opening an account in your name.
“Although banks do not check your credit to open a bank account, they do check consumer reporting agencies to confirm your identity and will not open a new account if there is a freeze,” Williams said.
You can freeze and unfreeze your credit reports from the three major credit bureaus— Equifax, Experian, and TransUnion—at no cost.
Check Your Credit Reports
Whether or not you request a credit freeze, you should monitor your credit reports for suspicious activity.
Report any suspected fraud to the three major credit bureaus and consider setting up a free fraud alert. You only need to notify one credit bureau to create a fraud alert, which will cover all three credit bureaus.
Inform the Federal Trade Commission
If you suspect you’ve been the victim of fraud, submit a report to the Federal Trade Commission (FTC). While reporting your suspicions might not help you immediately, it may help the FTC build criminal cases against scammers.
Report the Fraud
In addition to reporting it to the FTC, file a report of the suspected fraud with your local police or sheriff’s department. This is an important step in establishing a case of identity theft.
What Can Someone Do With Your Bank Account and Routing Numbers?
The consequences could be severe if your bank account number, routing number, or both wind up in the wrong hands. Potential issues include:
- Money stolen from your account through an electronic payment or transfer
- An online shopping spree carried out with money from your account
- Phony checks printed with your bank account and routing numbers that can be used to take money from your account
- A fake bank account established in your name
- Money laundered through your account
- Identity theft, such as if the scammers open new credit card accounts in your name
How Do Scammers Steal Bank Account Numbers?
Unscrupulous fraudsters can access and steal bank account numbers in a number of ways:
- Phishing: Phishing involves sending a fake email or text that prompts you to provide sensitive information, such as your bank account number. The email, text, or phone call may seem to be from your bank or another legitimate company, but is actually from a scammer.
- Cyberattacks: A hacker may be able to worm their way into your computer, phone, or other electronic device and hunt for account numbers and other important data. They might also try to load your device with malware that grants them further access to your device and the information on it.
- Data breaches: A hacker might break into a bank’s computer system and steal customers’ account numbers.
- Mail theft: In some cases, a crook might sift through your mail or trash to find a bank statement that includes your personal information.
Tips to Protect Your Bank Account and Routing Number
A few simple strategies can help protect your banking information. Here are tips for keeping your bank account and routing numbers safe from scammers.
- Be careful about clicking on links and downloading attachments in emails and other messages. Fraudsters can use links and attachments to phish for your bank account number, routing number, or other sensitive information.
- If you get a message that seems to be from your bank, don’t click on anything. Instead, call your bank’s customer service phone number and ask if they contacted you.
- Sign up for paperless statements. Switching to electronic statements can reduce the risk that someone could steal your paper statements and get access to your bank account number.
- Monitor your bank account. Regularly reviewing your account activity could help prevent fraud, or at least limit the damage if you notice and report it right away. It’s a good idea to frequently check your online banking account, read your monthly statements, and set up alerts to stay on top of account activity.
- Use a debit card or credit card for online shopping, so you don’t need to provide your bank account number or routing number. Credit cards in particular have robust fraud protections, making them a relatively safe payment method.
- Secure your account. Make it tougher for a thief to steal your bank account number or routing number by creating a hard-to-guess account password, setting up two-factor authentication for online accounts and electronic devices, and installing or updating security software on your devices.
Frequently Asked Questions (FAQs)
How Long Do You Have to Dispute Unauthorized Transactions to Your Bank?
You’ve got 60 days after receiving an account statement showing an unauthorized transaction to notify your bank that you want to dispute it. If you don’t notice suspicious transactions until after 60 days, you should still notify your bank, but you may not be able to recover the funds.
Can Someone Take Money From My Bank Account With Only My Account Number?
Fortunately, a scammer can’t withdraw money from your bank account with just your account number. To do so, they’d also need your bank’s routing number.
Can Someone Take Money From My Bank Account With Only My Routing Number?
A routing number alone won’t allow access to money in your bank account. Everyone with an account at that bank will use the same routing number.
Are You Liable for Transactions That Scammers Make Using Your Account?
In general, you’re not liable for transactions made by scammers. However, you need to act fast: You could be held liable for at least part of an unauthorized transaction if you don’t notify your bank about it within a certain number of days. For example, you must tell your bank about any unauthorized transactions you spot within 60 days of receiving the statement showing that activity. If you don’t, you may be held liable for those charges and other fraudulent charges made after that.
Who Is It Safe to Give My Bank Account Numbers To?
You can usually provide bank account numbers without safety concerns to your employer, tax-filing services, payment and money transfer services, trusted relatives and friends, and companies that receive automatic bill payments from you.
The Bottom Line
If you believe someone has your bank account number and might use it to commit fraud, take action right away. Among the steps you should take are contacting your bank, reviewing your bank statements for unauthorized transactions, and checking your credit reports. Always protect your personal and financial information, including your bank account number, so that it doesn’t end up in the wrong hands.
Read the original article on Investopedia.
How Can You Insure Deposits Over the FDIC Limit?
The Federal Deposit Insurance Corp. (FDIC) provides coverage for eligible bank accounts up to $250,000, but if you need more than that, there are several ways to obtain it. Your options include joint accounts and a variety of methods that spread your funds out among many banks, ensuring that all of your money is covered.
Businesses often need to keep more than $250,000 on hand, but given the history of major bank collapses, including First Republic Bank, Silicon Valley Bank, and Signature Bank, you’re taking a big risk by exceeding coverage limits with any one account or bank. In those cases, businesses and individuals were fortunate that the federal government stepped in and other banks took over, but those solutions may not always be guaranteed.
Key Takeaways
- FDIC insurance covers each depositor up to $250,000 per bank, per ownership category—but there are ways to get more coverage.
- Adding beneficiaries, opening a joint account, or moving some money over to another bank or credit union are easy ways to protect your funds beyond the standard FDIC coverage.
- Other programs and organizations, like MaxSafe accounts, the IntraFi network, and banks insured by the Deposit Insurance Fund (DIF), can extend your insured amount well beyond the $250,000 limit.
How Much Does the FDIC Insure?
FDIC insurance covers each depositor up to $250,000 per bank, per ownership category. To understand what that means, the first thing to know is that deposit accounts covered by the FDIC include checking accounts, savings accounts, certificates of deposit (CDs), and money market accounts, and those all belong to the same ownership category.
Therefore, if you have a checking account, a savings account, and a CD at one bank and their total balance is $300,000, you’d only be covered for up to $250,000 of those funds, even though they are spread across three accounts.
On the other hand, you could get higher levels of coverage if one of those accounts had a different ownership category, such as a joint savings account with a spouse. Examples of FDIC ownership categories include single accounts, joint accounts (which you share with another account holder), certain retirement accounts, employee benefit plan accounts, trust accounts, business accounts, and government accounts.
Account Type | FDIC Insurance Limit |
Single account | $250,000 per depositor |
Joint account | $250,000 per account co-owner |
IRAs (and other retirement accounts) | $250,000 per owner |
Revocable trusts | $250,000 per owner per unique beneficiary |
Irrevocable trusts | $250,000 per unique beneficiary on the account |
Employee benefit plan accounts | $250,000 per plan participant on the account |
Government accounts | $250,000 per official custodian |
Corporation, partnership, and unincorporated association accounts | $250,000 per corporation, partnership, or unincorporated association |
Insuring Deposits Over the FDIC Insurance Limit
As the bank closures mentioned above illustrate, keeping more than the FDIC-insured limit at one bank can put your assets in jeopardy. And although there was a remedy for the affected bank account holders, there may not be next time. Here are a few ways to protect sizable funds from potential bank failures.
Open Accounts at Other Banks or Credit Unions
Perhaps the simplest way to protect your money is to spread it out among a number of different banks and credit unions. The downside is that you’ll have more accounts to keep track of, but it can save you the headache of worrying about losing money should one of your banks fall on hard times.
Add a Joint Owner to Your Account
When you add a joint owner to an account, you essentially double your FDIC coverage. And you can even have more than two joint account owners, adding another $250,000 in insurance coverage for each owner. Just be sure you understand what it means to share a joint account with someone—that person has full access to the account, like you do.
Open an Account in a Different Ownership Category
As mentioned, FDIC insurance is applied for accounts by ownership category. So, at a single bank, you could protect $250,000 in an individual account, another $250,000 in a joint account with a family member or business partner, and another $250,000 in an individual retirement account (IRA).
Open a Cash Management Account
A cash management account is a hybrid type of banking, with features similar to checking and savings accounts plus the ability to manage investments. Cash management accounts work with partner banks to “sweep” your money into different accounts to ensure your money is fully insured. Institutions vary as to how much coverage they can provide, with some going up to $1 million or more.
There may be other types of insurance coverage available beyond FDIC, depending on the type of account you have. For example, with a cash management account, you may also be eligible for coverage from Securities Investor Protection Corp. (SIPC) for a portion of the funds. And credit unions offer similar coverage to the FDIC’s through the National Credit Union Association (NCUA).
Use IntraFi Network Deposits
The IntraFi Network, which was once known as the Certificate of Deposit Account Registry Service, or CDARS, lets people open and manage an account with one bank. But on the back end, their balances are spread out among several CDs or savings accounts at other network FDIC-insured banks. This practice ensures that each portion of customers’ balances remains below the $250,000 FDIC limit.
IntraFi has nearly 3,000 partner banks to help serve high-net-worth individuals, businesses, government entities, nonprofits, credit unions, and any others who want to expand their FDIC coverage.
Open a MaxSafe Account
If you have significant funds, consider opening a MaxSafe Account through Wintrust Community Bank. It’s a special kind of account that offers up to 15 times more insurance coverage than the standard—up to $3.75 million. Wintrust does this by spreading out your deposits across 15 community bank charters.
Open an Account With Both FDIC and DIF Insurance
While the federal government offers FDIC insurance, there is also a private entity called Deposit Insurance Fund that provides coverage for amounts exceeding the $250,000 limit. The catch is that DIF coverage is only available at fewer than 80 banks, and all are located in Massachusetts.
Why Aren’t FDIC Insurance Limits Higher?
The FDIC set the $250,000 limit back in 2006 after making increases up to that amount throughout its history since its establishment in 1934. As for what the future may hold, the FDIC released a report in May 2023 in which options were evaluated. These included leaving the $250,000 as is, extending unlimited deposit insurance coverage to all depositors, or raising it just for business payment accounts.
The FDIC has shown signs of leaning toward the targeted increase for businesses, in light of the danger posed by the bank shutdowns. But any changes to insurance limits will require approval from Congress.
Frequently Asked Questions (FAQs)
What Is the FDIC Limit for a Single Account?
The FDIC limit for a single covered account with no beneficiaries is $250,000.
How Much Does the FDIC Cover With Two Beneficiaries?
If you have a bank account and designate a beneficiary in the event of your death, the account is insured as a revocable trust account. For revocable trust accounts, the FDIC covers up to $250,000 per beneficiary. Therefore, with two beneficiaries the total coverage is $500,000, for three beneficiaries it’s $750,000, and so on.
Does the FDIC Cover Multiple Accounts?
The FDIC insures up to $250,000 per account, per bank, per ownership category. The key here is the ownership category. If you have multiple accounts that fall into the same category (as checking, savings, CDs, and money markets do), the FDIC covers the combined amount of those accounts up to $250,000. However, if any of the accounts have different ownership categories (for example, individual checking accounts and IRAs fall into different categories), then you would be covered up to $250,000 for each account type.
The Bottom Line
When choosing how and where to store your money, it’s important to understand FDIC coverage limits so all of your funds are protected. Being strategic about where you allocate your funds—whether that means spreading cash across different types of accounts or banking institutions, or using the IntraFi Network or a MaxSafe account—can extend your coverage well beyond $250,000. Your ultimate goal is to ensure that you won’t experience any loss should your bank fail.
Read the original article on Investopedia.