Check writing point of sale system

Abstract

A point of sale system designed to read information from a consumer's check, credit card, or manual input with a subsequent debiting of a consumer's account and crediting merchant's account for the goods or services provided. Point of sale terminals are designed to accept a form of credit card with a consumer's bank account information encoded thereon or in the alternative to read the MICR number from a consumer's check in order to verify that a consumer has an appropriate balance to conduct the transaction with a given merchant. Thereafter the transaction of that information is transmitted to a central computer system which verifies the consumer's credit worthiness and stores the transaction event information for subsequent bank reconciliation via the ACH or other competing network. The invention eliminates the need for paper checks with all bank reconciliation being accomplished electronically. The present invention also includes fraud protection provisions such as velocity controls, social security checks, and scans. The present invention has the further flexibility to differentiate between “first time” consumer usage and those limits otherwise assigned to “known” consumer accounts. Additionally, there is not need for the present system to retain the consumer's check after verification.

Description

RELATED PATENTS[0001]This application is a continuation of application Ser. No. 09 / 851,609 filed on May 9, 2001, now U.S. Pat. No. 6,354,491, which is a divisional of application Ser. No. 09 / 562,303, filed on May 1, 2000 now U.S. Pat. No. 6,283,366, which is a continuation of application Ser. No. 08 / 775,400, filed on Dec. 31, 1996, now U.S. Pat. No. 6,164,528.FIELD OF THE INVENTION[0002]This invention relates to the field of Point-of-Sale systems and more particularly to the integration and processing of purchases whereby a check or encoded card is used as the basic source of identification of the individual and of the individual's bank and whereby the bank account is debited electronically.BACKGROUND ART[0003]Numerous devices exist for processing checks. For example, U.S. Pat. No. 4,933,536 to Lindemann, et al., describes a check processing device which is used together with a Point-of-Sale terminal. This particular device involves copying and taking a picture of an individual wher...

AI Technical Summary

Benefits of technology

[0017]The present invention comprises a process and apparatus which may be employed for the purpose of effecting payments for point-of-sale purchases of goods and services paid from consumer funds secured in bank checking or depository accounts. Each sale of “Transaction Event” would be an electronic and “paperless” event thereby eliminating reliance on accepting and processing commercial bank drafts (personal or corporate checks) and the physical handling of those bank drafts thus replacing commercial bank drafts at the point-of-sale.

[0018]In contrast to known systems, the present invention is a merchant driven system that can be used to process a transaction at the point of sale and at the time of purchase. The system is intended to be made available to subscribing merchants, businesses, and individuals herein referred to as “system subscribers” wishing to employ the method and apparatus of the present invention for the electronic processing and settlement of consumer purchases. Further, operational parameters of the present invention allow freedom from customary state or other geographically limiting criteria typical when accepting and processing “paper” checks. The system is designed to act with the national authorization networks and the electronic settlement network known as the ACH system as regulated by the National Automated Clearing House Association (“NACHA”) or other comparable systems including but not limited to ECCHO, the Cactus Switch, First Tennessee Bank, regional networks, the VISA network, and others. The present invention contemplates Transaction Events processed in a manner hereinafter referred to as “Electronic Checks” or “Electronic Checking.”

Problems solved by technology

The Deming system cannot be used to read account and other information directly from an ordinary bank check and has no use for bank checks as instruments other than negotiable paper.

Further, the Deming system cannot be used to transfer finds at the time of purchase and is not workable at the point of sale; the system can only be used to pay debts that have been incurred in the past and have accumulated.

They do not in any way address the subsequent processing of checks nor do they address the process by which checks are cleared through the normal automatic check handling clearinghouse operations that exist in the financial world.

Thus, the interaction of these systems with the automated clearing house (“ACH”) process is not addressed in any way.

None of these systems completely does away with the need and use for a negotiable draft instrument while using the consumer's bank check for identification and verification only.

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