PayPal shocked its users with the end of its popular mobile check capture feature on the PayPal app.
Garry Knight / flickr | https://flic.kr/p/atFzej
With more than 148 million active registered accounts in 203 markets, PayPal users around the world were impacted by the choice to take away one of the most convenient services they offered.
Even more perplexing is the fact that eBay Inc. which once owned PayPal, supported the controversial choice of pulling the plug on a feature eBay shop owners and businesses depend on to funnel revenue into their businesses.
Now, these individuals have been forced to figure out a new way to deposit checks into their PayPal accounts. In case you’re wondering why users don’t use mobile check deposit with their own banks, many banks don’t yet offer this feature, or it’s quite possible that these users simply live in a rural area and can’t easily access a branch.
Two PayPal mobile alternatives
Though PayPal appears to have been the easiest way to directly deposit checks, there are alternative methods of getting mobile deposit that come with very few strings attached. For those who strictly want to do all banking remotely, here are two alternatives to replace PayPal’s mobile remote deposit capture.
1. A prepaid card that accepts mobile deposits: A reloadable prepaid card is one way to get mobile check deposit without needing to set up a bank account.
American Express Bluebird for instance, is a prepaid card that has no minimum balance requirements and offers free mobile check deposit through their Bluebird Mobile App for iPhone or Android. Additionally, Bluebird has no monthly or annual fees, bill pay fees, overdraft fees, inactivity fees, foreign exchange fees, or card replacement fees.
What makes this card so special is that with no inactivity fee and no monthly fee, you won’t be charged if you decide not to use your card. However, withdrawals at non-MoneyPass ATMs will cost you $2 and an ATM network surcharge. Bluebird members who don’t have direct deposit connected into their card pay a $2 fee, even at MoneyPass ATMs.
2. An online or mobile bank: Online banks do a lot to sweeten the deal for their customers. Many, such as Ally Bank, reimburse customers for any and all ATM surcharges and fees, which means they get to withdraw money from whatever bank or ATM is most convenient for them.
Also, because these banks don’t have to spend money on physical upkeep, they can offer customers high-yield checking and savings accounts and better rates on loans. Opening an account is usually free, and last of all, online banks dedicate funds to developing their mobile banking platforms.
MyBankTracker rates banks and allows readers to rate them as well. One popular online bank known for their high-yield rates is Ally Bank. Customers who have a daily balance of $15,000 or more get a 0.60 annual percentage yield, and those with daily balances under $15,000 get a 0.10 annual percentage yield. Their interest checking has no monthly maintenance fees and doesn’t require a minimum balance to open.
Another online bank that offers great value to their customers is Bank of Internet. This bank doesn’t have monthly maintenance fees or a minimum monthly balance, as well as unlimited ATM reimbursements, but does require a minimum of $100 to open. However, in return, cardholders receive 1.25 percent APY on all balances under $150,000.
PayPal’s reasoning behind the move
A representative of PayPal confirmed that there is no direct method of depositing checks into PayPal accounts directly any longer. “We don’t have any options of depositing checks through our system at all,” the representative said.
“It would have to go to a local bank or whatever party you decide to use for check cashing. However, you can always add money from the bank account once that bank has been deposited via your bank. That would be the only route to get those funds into your account.”
According to one study, mobile remote deposit capture is the “most sought-after mobile banking feature” among consumers. However, according to PayPal, the service was hindering their growth.
“As far the concern of the removal of that, the information that we were given is the company decided to focus more on digital payment which we’re known for and do quite well,” she stated. “They found that the check feature was not something that was allowing us to grow in the digital world so they kind of decided we would focus in a different direction.”
The losses felt as a result
In considering the demographic most impacted, a visit to an online forum easily illustrates the untold story of many individuals who rely on PayPal’s easily accessible financial services for their needs, especially those who dislike banking. On eBay in particular, shop owners receive a wide range of personalities and payment methods, such as the older generation that may prefer to use traditional payment, like checks, to pay for purchases instead of credit cards or PayPal.
Mobility may also play a role in the desire to bank remotely. However, mobile remote deposit capture is offered by many physical brick-and-mortar banks now as well, so the degree to which a customer would need to visit a bank may be minimal. In fact, checking accounts that don’t charge a monthly maintenance fee and don’t require a minimum balance each month may be an ideal solution.
Do you have any alternatives to share? Leave your comments down below, or comment us on Facebook!