Prepaid card companies have salivated for years at the possibilities of mobile remote deposit capture (RDC), or MDC. Having the ability to scan checks with smart phones and remotely deposit funds to general purpose reloadable (GPR) prepaid card accounts eliminates the middle steps of cardholders having to cash checks and buy reload packs with the cash in order to reload accounts. But fraud risks inherent in the unsupervised scanning of checks has been the chief stumbling block to the adoption of prepaid MDC.
"On a mobile phone, you or I can take a picture of a check at any point, at any time," said Randy Simoneaux, founder and Chairman of RDC provider Clear Payments Inc. "And somebody better be smart enough and be able to look at that image, know that check, know that maker, know the profile, know hundreds or thousands of business rules that have to be done in milliseconds."
A new service built by CPI and check guarantee company Chexar Network Inc. may have solved that problem. In the companies' check-to-card Deposit Choice solution, CPI prepares and processes scanned checks and Chexar clears and settles them. The service is targeted at the financially underserved consumer segment, estimated at over 88 million in the United States, according to audit and advisory firm KPMG LLP.
Simoneaux said, "So, literally, in a matter of seconds, you can take a picture of a check, we can approve it, settle it to the prepaid card company, and that prepaid card can be loaded literally within a couple of minutes – the entire transaction."
In 2006, CPI branched out from traditional, bank-centric RDC to develop new channels for the service. One such channel turned out to be churches that use CPI's technology to remotely scan and deposit tithes, Simoneaux said.
In 2008, CPI turned to check cashers to help them process checks faster and with more sophisticated analytics to reduce check fraud. CPI leverages Chexar's Good Funds Network, which includes two call centers where checks flagged by the automated system go to be individually scrutinized by Chexar's staff.
The Deposit Choice service offers GPR cardholders two options: expedited or delayed MDC. "If the immediate funds cannot be approved, we can give that consumer an option to do a delayed deposit, which means that that check can be pushed to a bank or a prepaid card company," Simoneaux said. "And after the check goes through the system, and it comes back cleared, the funds can then automatically be triggered to be loaded onto the card."
Another aspect of Deposit Choice is Chexar's patent pending National Duplicate Check Database (DUPEX), which is designed to give check acceptors advanced warning of checks that are duplicates of previously cashed or deposited checks, remotely accomplished or otherwise. "If that [counterfeit] check shows up 30 minutes or an hour later at another location, anybody in that system will be able to see that that check had a prior account or was actually settled somewhere before," Simoneaux said.
He therefore believes DUPEX will be invaluable in the MDC space. When a check is cashed at a check casher, the physical check is held by the service provider; but not so in the mobile realm. "At the location, you turn that instrument over to somebody and it's kept," he said. "On mobile, you take the picture and you move on." 
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