Data processing: financial – business practice – management – or co – Automated electrical financial or business practice or... – Finance
Reexamination Certificate
1998-02-06
2001-03-13
Voeltz, Emanuel Todd (Department: 2761)
Data processing: financial, business practice, management, or co
Automated electrical financial or business practice or...
Finance
C705S026640, C705S035000, C705S039000
Reexamination Certificate
active
06202054
ABSTRACT:
FIELD OF THE INVENTION
The present invention relates to a method and system for distributing financial and other services to remote locations, and more specifically, provides banking type financial transaction handling via remote data terminals located in users' homes, offices or other locations (i.e., “home banking” or “remote banking”). Still more specifically, one aspect of the present invention involves using the ATM (automatic teller machine) network (interchange) as a data communications network for conducting banking financial transactions from homes and offices.
BACKGROUND AND SUMMARY OF THE INVENTION
Not long ago, “home banking” was thought to be just around the corner. With the advent of relatively inexpensive, powerful personal computers, the computer industry hoped (and predicted) that a personal computer with communications capability (e.g., modem) would soon find its way into every home.
It was generally believed by many that the home computer would become a central, integrated part of everyday life and would proliferate as have radio and television receivers in past decades. It was expected that people would prepare and file their income tax returns by computer, conduct most or all financial transactions (including billpaying) through software interfacing their personal computer and telecommunications lines with banks and other financial institutions, etc. The home personal computer was expected to largely replace the U.S. Postal Service as a means of communicating with and contacting the outside world. People would draft personal letters using word processing software on the personal computer and telecommunicate the letters electronically to the intended recipient over telecommunications networks. It was expected that shopping would be done electronically by perusing electronic merchandise and grocery catalogs “online” and placing orders electronically over a telecommunications data network; and that even newspapers would be read electronically “online” (thus obviating the need for delivery of hard copy).
A few banks and other financial institutions actually developed “home banking” systems designed to interface with home personal computers expected to soon be found in most households.
Ordinary people are generally not used to computers and many avoid them whenever possible. While the next generation may be highly computer literate, many of their parents and grandparents have little or no computer experience and would much rather continue doing things “the old way.” Even computer literates who own home personal computers find use of the computer to be relatively limited. As one example, it continues to be relatively expensive and impractical to send “mail” electronically. Telecommunicating over telephone lines is relatively expensive, and only just recently have regional telephone companies entered the public data network (PDN) business thereby increasing capacity and reducing user costs. Moreover, most intended electronic mail recipients do not even have computers, the necessary communications equipment and the knowledge and experience.
Perhaps more importantly, the “learning curve” associated with familiarizing oneself with new software is often so steep that even computer literate people look upon learning a new software package with great disdain and apprehension. Thousands upon thousands of different software packages are on the market, but the top sellers are typically the first packages to be introduced. This is because users tend to continue to use software they already know and resist learning new packages unless they are convinced the effort will be worthwhile. Even “user friendly” software may be very time consuming to learn. Many users would probably prefer to continue their banking transactions in “the old way” rather than spending even only a few hours learning a completely new home banking software package.
In addition, the cost of providing home banking services have been enormous. Service providers incur very high communications costs in linking their central processors with PC users, banks, and payees (merchants). Many payees also do not accept electronic payments (for lack of substantial volume), forcing service providers to make costly paper-based payments. Settlements processing can also be costly, as banks must install special purpose software and operating procedures. These and other costs have been passed along to consumers, thereby dampening the demand for home banking services.
Thus, although a small percentage of people have effectively come to utilize and rely upon some of the vast variety of services accessible through a home computer as an integral part of their daily lives, the vast majority continue to communicate by post and telephone, shop by visiting retail stores or leafing through hard copy catalogs received in the mail, and pay their bills by writing checks and sending them through the mails.
In part because of the problems discussed above, PC-based home banking is not yet a practical reality for most consumers. In fact, many home banking programs launched in the past have been declared failures and discontinued. See, for example,
Egner, “Not Quite Ready for Home Banking”,
The EFT Sourcebook
, pp 171-175 (1988); and
Tyson, “‘Survival’ Kit: Pens and Stamps Instead of Video”,
American Banker
(Mar. 16, 1989).
Few corporations continue to market cumbersome, hard-to-use, PC and modem-based home banking systems developed a few years ago. Covidea, a joint venture between Chemical Bank and AT&T, was the earliest, most notable PC-based home banking enterprise. After $70 million in investment and nearly 10 years of development and marketing, Covidea recently terminated its operations. Chemical and AT&T cited obsolete technology as the principal reason for closing operations. Knight-Ridder, AMR and others have ceased operating their PC-based home banking services. The following institutions, however, continue to operate home banking systems:
MAJOR HOME BANKING OPERATORS
Operator
Name of Service
Est. Users
Bank of America
Homebanking
37,000
Manufacturers Hanover
Excel
7,000
Citibank
Direct Access
15,000
Chase Manhattan
Spectrum
5,000
Madison Bank
Home Teller
2,000
Princeton Telecom
licensed to banks
2,000
Harbinger Computer
licensed to banks
2,000
Prodigy
licensed to banks
10,000
Source: Teleservices Report, Arlen Communications, 1987 Videotext Industry Association, 1988
Prodigy (a joint venture between IBM and Sears) is the primary major operator actively pursuing the national market. Much like the banks, Prodigy targets personal computer users (with modems) with extensive videotext service (e.g. airline reservations, and home shopping). Unlike the banks, however, bank services are secondary and Prodigy hopes to offset some of its high costs with advertising revenues. Even if Prodigy succeeds, its services are aimed at a high-end, technology-user—not the broader market comprising the majority of bank customers.
Telephone banking operators have recently begun to allow customers to pay bills from home. Some such telephone billpaying systems involve voice response technology to provide automatic handling of limited customer financial transactions (thus eliminating the requirement for human operators to answer and handle customer calls). Several independent telephone billpaying services have emerged (e.g. Checkfree and Merchants Network), but most billpaying services are offered by individual banks. Recent voice-response technology advances have enabled telephone banking and billpaying to become the banking industry's fastest growing retail product. Payments Systems, Inc., a leading electronic funds transfer consulting firm, estimates that 5-7 million U.S. households use telephone banking in 1988 versus approximately 2 million in 1985.
Nonetheless, telephone billpaying has serious limitations because of its lack of a visual interface (i.e., display). Telephone voice response systems only permit the presentation of very limited, simple alternatives. Sophisticated service offerings are not practical because
Carmody Timothy E.
Lawlor Matthew P.
Morgan George D.
Nixon & Vanderhye P.C.
Online Resources & Communications Corp.
Todd Voeltz Emanuel
LandOfFree
Method and system for remote delivery of retail banking... does not yet have a rating. At this time, there are no reviews or comments for this patent.
If you have personal experience with Method and system for remote delivery of retail banking..., we encourage you to share that experience with our LandOfFree.com community. Your opinion is very important and Method and system for remote delivery of retail banking... will most certainly appreciate the feedback.
Profile ID: LFUS-PAI-O-2454631