METHOD AND SYSTEM FOR ELECTRONIC SETTLEMENT OF CHECKS

• US 20080097899A1
• Filed: 07/13/2007
• Published: 04/24/2008
• Est. Priority Date: 07/14/2006
• Status: Abandoned Application

• Current Assignee: The Clearing House Payments Company LLC (The Clearing House LLC)
• Original Assignee: The Clearing House Payments Company LLC (The Clearing House LLC)
• Inventors: MIRABELLA, JOSEPH, JACKSON, STEVE, PAWELCZYK, JOSEPH
• Application Number:
  US11/777,690
• Publication Number:
  US 20080097899A1
• Time in Patent Office: Days
• US Class Current: 705/39
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03

Abstract

A system is provided for settling cash letters containing check images that are exchanged by banks connected to an image exchange system (IEX). Settlement amounts are computed and sent to the Federal Reserve Banks'"'"' National Settlement Service (FRBNSS) for settlement based upon business rules. Further, a method is provided for processing a financial check transaction between a plurality of financial institutions, including at least first and second institutions, the method including providing electronic check data, relating to at least one check to be paid by the second institution, from the first institution to the second institution to effect an automatic check presentment; and automatically performing an electronic settlement determination for the at least one check, based on the electronic check data and predetermined business rules.

Claims

1. A method for processing a financial check transaction between a plurality of financial institutions, including at least first and second institutions, the method comprising steps of:

providing electronic check data, relating to at least one check to be paid by the second institution, from the first institution to the second institution to effect an automatic check presentment; and

automatically performing an electronic settlement determination for the at least one check, based on the electronic check data and predetermined business rules.

2. The method of claim 1, further comprising a step of notifying the first and second institutions of a result of the performing step.

3. The method of claim 1, further comprising a step of notifying a Federal Reserve Bank of a result of the performing step.

4. The method of claim 1, wherein the predetermined business rules are associated with the second institution and are applied to the electronic check data to perform the electronic settlement determination.

5. The method of claim 1, wherein the performing step includes retrieving the predetermined business rules from a database associated with a main facility.

6. The method of claim 1, further comprising a step of determining an image letter cutoff time of the second institution, and wherein the performing step is based on the image ledger cutoff time.

7. The method of claim 1, wherein the performing step includes conducting a settlement at least two times a day to process plural financial check transactions.

8. The method of claim 1, further comprising a step of identifying a type of the electronic check data, wherein the performing step includes applying respective predetermined business rules based on the identified type of the electronic check data.

9. The method of claim 8, wherein the type of the electronic check data is one of an image cash letter (ICL) and electronic check presentment data with images (ECPI).

10. A check settlement method for calculating a final net position between a first bank having a first DTA and a second bank having a second DTA, the method comprising:

creating an ICL at the first bank;

validating the ICL at the first DTA;

transmitting the validated ICL to the second DTA;

transmitting high level data associated with the ICL to a main DTA of a main facility;

sending from the first DTA to the main DTA a delivered message including a timestamp;

retrieving an ILCT for the second bank from a database associated with the main DTA;

comparing the timestamp to the retrieved ILCT for the second bank; and

at the main facility, calculating a final net position between the first and second banks based on a result of the comparison and predefined business rules, wherein the calculating of the final net position is performed automatically.

11. The check settlement method according to claim 10, wherein the final net position is calculated at an image settlement server included in the main facility.

12. The check settlement method according to claim 11, further comprising:

creating a file containing the final net position; and

transmitting the file to a NSSFRB for final settlement.

13. The check settlement method according to claim 12, wherein the transmission of the file to the NSSFRB is performed by a SST via a dedicated line.

14. The check settlement method according to claim 10, wherein the ILCT of the second bank includes a plurality of ILCTs.

15. A system for processing a financial check transaction, comprising:

a plurality of financial institutions, including at least first and second institutions, the first and second institutions arranged to communicate electronically with each other to effect an automatic check presentment; and

a main facility arranged to automatically perform an electronic check settlement determination based on the presentment and predetermined business rules.

16. The system of claim 15, wherein the main facility is arranged to notify the first and second institutions of a result of the electronic check settlement determination.

17. The system of claim 15, wherein the main facility is arranged to notify a Federal Reserve Bank of a result of the electronic check settlement determination.

18. The system of claim 15, wherein the predetermined business rules are associated with the second institution and are applied by the main facility to electronic check data relating to the presentment to perform the electronic check settlement determination.

19. The system of claim 15, wherein the main facility is arranged to retrieve the predetermined business rules from a database associated with a main facility.

20. The system of claim 15, wherein the main facility is arranged to determine an image ledger cutoff time of the second institution, and wherein the electronic check settlement determination is performed based on the image ledger cutoff time.

21. The system of claim 15, wherein the electronic check settlement determination is performed at least two times a day to process plural financial check transactions.

22. The system of claim 15, wherein the main facility is arranged to identify a type of the electronic check data involved in the transaction, and the electronic check settlement determination is performed by the main facility and includes applying respective predetermined business rules based on the identified type of the electronic check data.

23. The system of claim 22, wherein the type of the electronic check data is one of an image cash letter (ICL) and electronic check presentment data with images (ECPI).

24. A computer program, embodied in a computer-readable medium, that when executed processes a financial check transaction between a plurality of financial institutions, including at least first and second institutions, comprising:

code for providing electronic check data, relating to at least one check to be paid by the second institution, from the first institution to the second institution to effect an automatic check presentment; and

code for automatically performing an electronic settlement determination for the at least one check, based on the electronic check data and predetermined business rules.

25. The computer program of claim 24, further comprising code for notifying the first and second institutions of a result of performing the electronic settlement determination.

26. The computer program of claim 24, further comprising code for notifying a Federal Reserve Bank of a result of performing the electronic settlement determination.

27. The computer program of claim 24, wherein the code for performing the electronic settlement determination includes code for applying predetermined business rules associated with the second institution to the electronic check data to perform the electronic settlement determination.

28. The computer program of claim 24, wherein the code for performing the electronic settlement determination includes code for retrieving the predetermined business rules from a database associated with a main facility.

29. The computer program of claim 24, further comprising code for determining an image ledger cutoff time of the second institution, wherein the code for performing the electronic settlement determination performs the electronic settlement determination based on the image ledger cutoff time.

30. The computer program of claim 24, wherein the code for performing the electronic settlement determination conducts a settlement at least two times a day to process plural financial check transactions.

31. The computer program of claim 24, further comprising code for identifying a type of the electronic check data, wherein the code for performing the electronic settlement determination applies respective predetermined business rules based on the identified type of the check data.

32. The computer program of claim 31, wherein the type of the electronic check data is one of an image cash letter (ICL) and electronic check presentment data with images (ECPI).