News Column

Researchers Submit Patent Application, "E-Check and E-Commerce", for Approval

June 26, 2014



By a News Reporter-Staff News Editor at Politics & Government Week -- From Washington, D.C., VerticalNews journalists report that a patent application by the inventors Rodriguez, Herman (Austin, TX); Smith, JR., Newton J. (Austin, TX); Spinac, Clifford J. (Austin, TX), filed on January 15, 2014, was made available online on June 12, 2014.

The patent's assignee is Toshiba Global Commerce Solutions Holdings Corporation.

News editors obtained the following quote from the background information supplied by the inventors: "Current business processes for Point of Sale (POS) accept various forms of payment for merchandise such as checks, credit cards, debit cards, or cash. For example, a customer may purchase a product with a credit card from a merchant at the merchant's store or electronically via the merchant's web site. The merchant will process the credit card payment, electronically communicating with the credit card company to verify that the credit card company is willing to pay the amount of currency described by the merchant for the transaction. Once the transaction is authorized, an approval code is provided to the merchant and the merchant completes the transaction by providing the customer with a receipt that includes the product and some description to identify the form of payment like the credit card utilized for payment.

"Unlike credit card, debit card, and cash transactions, however, transactions in which the purchaser pays for merchandise by check involve an additional delay in processing, which is referred to as a 'float' period. The delay is disadvantageous for both the merchant and the merchant's bank and involves duplicative efforts by the parties. More specifically, processing and clearing a check currently takes about 36-72 hours from the time a check is written until it is actually paid out of the purchaser's account. One of the reasons for the delay is that the paper cheeks must be sent to a check clearinghouse like the Federal Reserve Rank/Clearinghouse where the amount of the check is manually entered and printed on the bottom right edge of the check. Then, the check is sent to the bank of the purchaser where the check is sorted, scanned, recorded for the monthly statement, and the money is finally deducted from the account. Thus, the purchaser gets the advantage of the 36-72 hour 'float' period because the purchaser receives goods, services, cash, etc., while the actual money represented by the cheek remains in the purchaser's checking account, drawing interest.

"The merchant's bank is disadvantaged because the merchant's bank will show the balance of the check in the merchant's bank account for the 'float' period. Further, the merchant is disadvantaged because the merchant will not know during the delay, possibly for several days, whether the check is actually good, i.e., whether the purchaser actually has sufficient funds available for the transaction, and, even if the purchaser does have the funds available, the funds that show in the merchant's account may be placed on hold by the merchant's bank until they are actually received or for some standard number of days to make sure that the funds are received before being available to the merchant.

"Merchants who accept payment by check at the point of sale usually run the check through the point-of-sale (POS) terminal in order to request service from the check clearinghouse and to print certain merchant information on the back of the check. In the case where the check is accepted by the merchant, the current technology requires substantially manual data entry of the purchase amount into the POS terminal by the cashier; the purchaser's identification, such as a driver's license number and sometimes telephone number by the cashier; and the merchant's account information for depositing the check in the merchant's account.

"Once the check is accepted, the merchant collects the checks received throughout a given period, usually a day, and deposits these checks at the merchant's bank. Then, the bank and the check clearinghouse will process the check information as one of the steps in clearing the check. This is typically a manual process involving keying in and printing on the check (using Magnetic Ink Character Recognition 'MICR' such as an E-13B font with 14 characters), the amount of the check, duplicating the efforts of the cashier.

"After the merchant, merchant's bank, check clearinghouse, and purchaser's bank process the check, the purchaser finally receives the cancelled check or a scanned image of the check. In situations wherein the purchaser's bank supplies the purchaser with a scanned image of the check, the purchaser's bank generally provides the scanned image to the purchaser as hardcopy or on the Internet."

As a supplement to the background information on this patent application, VerticalNews correspondents also obtained the inventors' summary information for this patent application: "The problems identified above are in large part addressed by methods, systems, and media to process and clear a check. One embodiment provides a method for generating an check. The method generally includes scanning a cheek to create an image of the check in response to receiving a check as payment for a transaction; entering an amount of currency represented by the cheek into a point of sale terminal; identifying check information that describes a bank and a bank account, wherein the check comprises the check information; and generating a check object based upon the image, the amount, and the check information.

"Another embodiment provides a method for transacting with an e-check. The method generally includes generating the e-check based upon a check, to substitute for a check as payment for a transaction; transmitting the e-check to a bank, wherein the bank is identified by a routing number on the check; and receiving a response to transmission of the e-check from the bank, the response to clear the check when sufficient funds are available for the transaction from an account associated with the e-check.

"Some embodiments provide an apparatus for generating an e-check. The apparatus contemplates an image scanner to create an image of a check in response to receiving the check as payment for a transaction; an input device to input an amount of currency represented by the check; a character scanner to scan the check to identify cheek information that describes a bank and a bank account; and an e-check generator to generate a check object based upon the image, the amount, and the check information.

"A further embodiment provides a machine-accessible medium containing instructions, which when executed by a machine, cause said machine to perform operations. The operations can involve scanning a check to create an image of the check in response to receiving a cheek as payment for a transaction; entering an amount of currency represented by the check into a point of sale terminal; identifying cheek information that describes a bank and a bank account, wherein the check comprises the check information; and generating a check object based upon the image, the amount, and the check information.

BRIEF DESCRIPTION Of THE DRAWINGS

"Other objects and advantages of the invention will become apparent upon reading the following detailed description and upon reference to the accompanying drawings in which like references may indicate similar elements;

"FIG. 1 depicts an embodiment of a system including a client computer system, email servers, and recipients coupled via a LAN and/or WAN to process and clear a check;

"FIG. 2 depicts an embodiment of an e-check, or electronic check object;

"FIG. 3 depicts an embodiment of a point of service (POS) terminal to generate and process an e-check; and

"FIG. 4 depicts an example of a flow chart to process and clear a check."

For additional information on this patent application, see: Rodriguez, Herman; Smith, JR., Newton J.; Spinac, Clifford J. E-Check and E-Commerce. Filed January 15, 2014 and posted June 12, 2014. Patent URL: http://appft.uspto.gov/netacgi/nph-Parser?Sect1=PTO2&Sect2=HITOFF&u=%2Fnetahtml%2FPTO%2Fsearch-adv.html&r=1043&p=21&f=G&l=50&d=PG01&S1=20140605.PD.&OS=PD/20140605&RS=PD/20140605

Keywords for this news article include: Toshiba Global Commerce Solutions Holdings Corporation.

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Source: Politics & Government Week


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