If you want to do mobile banking from iPhone or Android, PayPal just killed off the easiest way to deposit a check on the iPhone and Android, and the only way many credit union and community bank users could remotely deposit a check with the iPhone.
PayPal announced in an email this morning that the company will no longer allow users to deposit a check on the iPhone or Android using the built-in camera and the PayPal app. The free service is an essential tool for millions that bank at a credit union or small bank that does not offer a check capture app for iPhone or Android.
In 2010 PayPal Mobile Check Capture arrived, allowing iPhone users to deposit checks into PayPal using the iPhone camera, and in 2011 added the ability to deposit a check with Android to the PayPal app.
PayPal does not offer a reason for removing the easiest way to deposit a check on iPhone and Android, and did not offer any advance warning to users. The notice came in an email from PayPal on Sunday to users that utilized the remote check deposit feature in the past. Users will still be able to access their transaction history and checks scanned in before the notice should deposit as normal.
The email from PayPal starts with the subject, “We’re no longer offering mobile check capturing”, and explains the change as much as the company is willing to at this point.
On June 15, 2014, the PayPal Mobile Check Capture service will no longer be available. But don’t worry, you’ll still have access to your transaction history of the checks you had captured through PayPal and can go back to review them at any time. We’re sorry if this is an inconvenience.
As of this morning the option to use PayPal Mobile Check Capture is missing from the app, leaving users frustrated and many without an easy way to use the iPhone to deposit a check. Many smaller banks don’t offer an Android or iPhone app with check deposit, which meant many users relied on this free service to deposit a check into PayPal and then into their bank. This proved essential for users that are not close to a branch, for college students living away from their main credit union or bank and many others.
On Twitter users complained about the change, which took place with no notice and without any explanation.
PayPal no longer offering mobile check capture because it was actually a useful service.
— Joe 💤obkiw (@zobskewed) June 15, 2014
Nooo! PayPal is shutting down its mobile check capture service nooOOOOOOOOOOO.
— John Garrett (@johngarrettX) June 15, 2014
The free PayPal Android and iPhone Check deposit feature brought a big bank feature to smaller banks, and the move could force some consumers to rethink where they bank. Although PayPal did not give a reason for the change, the service appears to be in the middle of a shift from acting as a way to pay for online goods and a way to pay for items at brick and mortar stores.
The PayPal app is focused on pushing users into Dollar General, Aeropostale and American Eagle to spend money with PayPal instead of acting first as a way to send money to a friend or make an online payment. The last email PayPal sent before this announcement was a reminder top go out and spend money, and not a new feature or useful service.
There are banks that offer remote check deposit from an iPhone but you will need to be a member of that bank. These include Wells Fargo, Chase, USAA Bank, Charles Schwab, State Farm Bank and some credit unions. Many small banks cannot offer this technology at this time due to the cost of adding the feature to their online services. In late 2013 a community banking executive told Gotta Be Mobile that costs are coming down, and the feature could arrive at his bank in the future. Perhaps this change by PayPal will
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