Digital Payee Extraction from Paper Checks
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Solution Overview
Problem
The existing paper check system imposes a significant cost burden on financial institutions and customers due to the printing, processing, and disposal of paper checks, as well as the manual drafting and processing of transactions, which can be cumbersome and inefficient.
Innovation Solution
A financial institution computing system that processes paper check deposit requests to extract payee information, create digital payees, and facilitate electronic payment transactions, reducing the need for physical checks through optical character recognition and network interfaces for data exchange.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If paper check processing is used, then payment transactions can be completed with physical instruments, but significant cost burden is imposed on financial institutions due to printing, processing, and disposal
Solution Approach 1:
The patent creates digital copies of paper check data by extracting information through optical character recognition and storing it as electronic payee records. This allows the payment system to operate using digital representations rather than physical checks, eliminating printing and disposal costs while maintaining transaction reliability
Solution Approach 2:
The patent replaces the mechanical paper check processing system with an electronic data processing system. Physical check handling is substituted by digital data extraction, storage, and processing, thereby eliminating the cost burden associated with physical instrument management
2Reliability
If paper check processing is used, then payment transactions can be completed with hard copy instruments, but significant burden is placed on customers and institutions for manual drafting and processing
Solution Approach 1:
The system automatically extracts payee information from deposited checks through optical character recognition, eliminating the need for manual data entry. The system self-services the information extraction and storage processes, reducing the operational burden on both customers and institution staff
Solution Approach 2:
Manual check drafting and data processing is replaced by automated optical character recognition and electronic data processing systems. This substitution eliminates the cumbersome manual tasks while maintaining the reliability of payment transactions
3Ease of operation
If electronic transaction systems are implemented, then convenience for customers is improved and costs for financial institutions are reduced, but system complexity increases
Solution Approach 1:
The patent segments the electronic transaction system into distinct functional modules: optical character recognition module for data extraction, payee information storage module for data management, and payment processing module for transaction execution. This segmentation manages system complexity by organizing functions into independent, manageable components
Solution Approach 2:
The patent creates a universal payee information storage system that handles multiple functions including data extraction, storage, retrieval, and processing. This multi-functional approach consolidates operations into a single system framework, managing complexity through functional integration rather than separate systems
Data Source
AI summary
Methods and systems of generating payees from paper check deposits are disclosed. A financial institution computing system includes a data storage system, a network interface logic enabling the financial institution to exchange data over a network, a check processing logic, and a payment transaction logic. The check processing logic obtains payee information using a paper check deposit request submitted by a recipient. The payment transaction logic uses the payee information to create and store the potential payee in the data storage system.