Method and apparatus for online check processing

• US 20070288380A1
• Filed: 04/28/2006
• Published: 12/13/2007
• Est. Priority Date: 04/28/2006
• Status: Active Grant

• Current Assignee: Ed Starrs
• Original Assignee: Ed Starrs
• Inventors: Starrs, Ed
• Granted Patent: US 7,389,913 B2
• Time in Patent Office: Days
• US Class Current: 705/45
• CPC Class Codes: G06Q 20/042 characterized in that the payment protocol involves at least one cheque
• CPC Class Codes: G06Q 20/12 specially adapted for electronic shopping systems
• CPC Class Codes: G06Q 20/403 Solvency checks

Abstract

Methods and apparatus for processing an online payment for an item. In one implementation, the method includes receiving information from a user corresponding to online payment for an item. The information from the user is received through a graphical user interface, and includes an authorization to pay for the item using an electronic check. The method further includes creating an electronic image of an authorized demand draft based on the authorization received from the user. The electronic image of the authorized demand draft is created directly from the information provided by the user through the graphical user interface.

Claims

1. A computer-implemented method for processing an online payment from a user, the online payment being for an item that is purchasable through a website of a merchant, the method comprising:

receiving information from the user corresponding to the online payment for the item, the information from the user being received through a graphical user interface associated with the website of the merchant, the information from the user including a name of the user, bank data associated with the user, and an authorization to pay for the item using an electronic check;

creating an electronic image of an authorized demand draft based on the authorization received from the user, the electronic image of the authorized demand draft being created directly from the information provided by the user through the graphical user interface associated with the website of the merchant, the electronic image of the authorized demand draft including the name of the user, the bank data associated with the user;

transmitting the electronic image of the authorized demand draft to a financial institution corresponding to the bank data associated with the user; and

receiving funds from the financial institution based on the electronic image of the authorized demand draft to provide payment for the item.

2. The method of claim 1, wherein creating an electronic image of an authorized demand draft includes creating an electronic image of an authorized demand draft that is compliant with the Check Clearing for the 21st Century Act (Check 21).

3. The method of claim 2, wherein the electronic image of the authorized demand draft is unsigned by the user.

4. The method of claim 1, wherein creating an electronic image of an authorized demand draft, transmitting the electronic image of the authorized demand draft to a financial institution, and receiving funds from the financial institution based on the electronic image of the authorized demand draft are performed substantially in real-time.

5. The method of claim 1, further comprising performing one or more real-time verifications on the user prior to creating the electronic image of the authorized demand draft.

6. The method of claim 5, wherein performing one or more real-time verifications on the user comprises generating a blended risk score on the user, the blended risk score corresponding to a degree of risk associated with successfully performing an online payment transaction with the user, the blended risk score being a composite of a plurality of individual risk scores.

7. The method of claim 6, wherein each of the plurality of individual risk scores are weighted by a pre-determined factor.

8. The method of claim 1, wherein:

the item comprises one of a physical product, a service, digital media, or digital content; and

the financial institution is one of a bank, savings and loan (S&

L), credit union, or Federal Reserve.

25. The method of claim 2, wherein creating an electronic image of an authorized demand draft comprises creating an electronic (X9.37) image file.

9. A computer-implemented method for processing an online payment for an item, the method comprising:

receiving information from a user corresponding to the online payment for the item, the information from the user being received through a graphical user interface, the information from the user including an authorization to pay for the item using an electronic check;

creating an electronic image of an authorized demand draft based on the authorization received from the user, the electronic image of the authorized demand draft being created directly from the information provided by the user through the graphical user interface.

10. The method of claim 9, wherein creating an electronic image of an authorized demand draft includes creating an electronic image of an authorized demand draft that is compliant with the Check Clearing for the 21st Century Act (Check 21).

11. The method of claim 10, wherein the electronic image of the authorized demand draft is unsigned by the user.

12. The method of claim 10, further comprising:

transmitting the electronic image of the authorized demand draft to a financial institution; and

receiving funds from the financial institution based on the electronic image of the authorized demand draft to provide payment for the item.

13. The method of claim 12, wherein creating an electronic image of an authorized demand draft, transmitting the electronic image of the authorized demand draft to a financial institution, and receiving funds from the financial institution based on the electronic image of the authorized demand draft are performed substantially in real-time.

14. The method of claim 9, further comprising performing one or more real-time verifications on the user prior to creating the electronic image of the authorized demand draft.

15. The method of claim 14, wherein performing one or more real-time verifications on the user comprises generating a blended risk score on the user, the blended risk score corresponding to a degree of risk associated with successfully performing an online payment transaction with the user, the blended risk score being a composite of a plurality of individual risk scores.

16. The method of claim 9, wherein the information from the user is received through a graphical user interface associated with a website of a merchant through which the item is purchasable.

26. The method of claim 10, wherein creating an electronic image of an authorized demand draft comprises creating an electronic (X9.37) image file.

17. A check processing system for processing an online payment from a user, the online payment being for an item that is purchasable through a website of a merchant, the system comprising:

a first engine to receive information from the user corresponding to the online payment for the item, the information from the user being received through a graphical user interface associated with the website of the merchant, the information from the user including a name of the user, bank data associated with the user, and an authorization to pay for the item using an electronic check;

a second engine to create an electronic image of an authorized demand draft based on the authorization received from the user, the electronic image of the authorized demand draft being created directly from the information provided by the user through the graphical user interface associated with the website of the merchant, the electronic image of the authorized demand draft including the name of the user, the bank data associated with the user;

a third engine to transmit the electronic image of the authorized demand draft to a financial institution corresponding to the bank data associated with the user; and

a fourth engine to receive funds from the financial institution based on the electronic image of the authorized demand draft to provide payment for the item.

18. The system of claim 17, wherein the electronic image of the authorized demand draft is compliant with the Check Clearing for the 21st Century Act (Check 21).

19. The system of claim 18, wherein the electronic image of the authorized demand draft is unsigned by the user.

20. The system of claim 17, wherein the fourth engine is operable to receive the funds from the financial institution substantially in real-time relative to when the electronic image of the authorized demand draft is created and transmitted to the financial institution.

21. The system of claim 17, wherein one or more of the first engine, the second engine, the third engine, and the fourth engine are components of a single engine.

22. The system of claim 17, further comprising a fifth engine operable to perform one or more real-time verifications on the user prior to the second engine creating the electronic image of the authorized demand draft.

23. The system of claim 22, wherein the fifth engine operable to perform one or more real-time verifications including generating a blended risk score on the user, the blended risk score corresponding to a degree of risk associated with performing an online payment transaction with the user, the blended risk score being a composite of a plurality of individual risk scores.

24. The system of claim 23, wherein each of the plurality of individual risk scores are weighted by a pre-determined factor.

27. The system of claim 18, wherein the electronic image of an authorized demand draft comprises an electronic (X9.37) image file.

28. A computer-implemented method for processing an online payment for an item, the method comprising:

receiving information from a user corresponding to the online payment for the item, the information from the user being received through a graphical user interface, the information from the user including an authorization to pay for the item using an electronic check;

creating an electronic (X9.37) image file of an authorized demand draft based on the authorization received from the user, the electronic (X9.37) image file of the authorized demand draft being created directly from the information provided by the user through the graphical user interface;

transmitting the electronic (X9.37) image file directly to the Federal Reserve; and

receiving funds from the Federal Reserve based on the electronic (X9.37) image file,

wherein the funds are received from the Federal Reserve substantially in real-time relative to a time of the transmission of the electronic (X9.37) image file to the Federal Reserve.