Mobile Check Capture via OCR and ACH Settlement
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Solution Overview
Problem
Writing and depositing paper checks are inconvenient compared to other payment methods, as they require manual entry of details and can be lost during transit, making transactions time-consuming and prone to errors.
Innovation Solution
A mobile device application that captures images of checks to extract financial account information, allowing users to send and receive payments electronically through a check service provider, which verifies and processes the transactions via the Automated Clearing House (ACH) network.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of operation
If paper checks are used for financial transactions, then the transactions can be completed with simple infrastructure, but the process becomes inconvenient and time-consuming due to manual entry and physical handling requirements
Solution Approach 1:
The patent uses optical character recognition (OCR) to create a digital copy of the check image and extract text information automatically. This replaces the manual process of typing check details, allowing users to simply capture an image of a check while the system automatically extracts account numbers, routing numbers, and other financial information, significantly reducing the time and effort required for check processing
Solution Approach 2:
The patent replaces the mechanical process of physically writing and delivering checks with an electronic system. Instead of manually writing check details and physically delivering them to a bank, users capture check images with a mobile device camera, and the system automatically processes the transactions electronically through the ACH network, eliminating physical handling and reducing processing time
2Reliability
If paper checks are used for financial transactions, then the system remains simple and accessible, but the checks are prone to loss and errors during transit and handling
Solution Approach 1:
The patent creates a digital copy of the check image and stores it electronically in the mobile device's memory. This digital copy serves as the permanent record of the transaction, eliminating the risk of losing physical checks. The system can store multiple check images and transaction histories securely in the device's memory, providing reliable record-keeping without the physical handling risks associated with paper checks
Solution Approach 2:
The patent replaces the physical check handling process with electronic data transmission. Instead of physically delivering checks that can be lost or damaged, the system uses electronic communication through the ACH network to transfer financial information and process transactions. This eliminates the harmful factors of physical transit, such as loss, damage, and human error, while maintaining transaction security through established electronic banking infrastructure
3Device complexity
If manual check writing is used, then no additional equipment is needed, but the process requires multiple steps including entering details and delivering to bank location
Solution Approach 1:
The patent leverages the mobile device's existing camera and processing capabilities to perform multiple functions: capturing the check image, extracting text information through OCR, and initiating electronic transactions. This multi-functional approach eliminates the need for separate check writing equipment and bank location visits, allowing users to complete the entire check processing workflow from their mobile device while maintaining system accessibility
Solution Approach 2:
The patent performs preliminary actions by automatically extracting and validating check information (account numbers, routing numbers, amounts) immediately after capturing the image. This preliminary processing eliminates the need for subsequent manual data entry and verification steps, allowing the system to proceed directly to transaction initiation and significantly reducing the overall time required for check processing
Data Source
AI summary
A check service provider enables users to make and receive payments from a financial account via a mobile electronic device, such as a smartphone or tablet computer. The device includes a check module and a camera. A user can capture an image of a check using the camera and the check module deciphers information, such as an account number, bank routing number, and information regarding the account holder, from the image of the check. The user can then make payments from and receive payments into the financial account associated with the imaged check via the check module without having the physically write or deposit a check. The check service provider interacts with the ACH to settle payments directly between the user's accounts without handling the money. Users can be notified of pending payments via text, voice, and e-mail messaging.