System and method for processing checks and check transactions

Abstract

A system and method of processing paper checks that divides into two independent paths the processing of a data file representing a check and the digital image of the check. The data files and image files are separated both in time and in space, with the data files being used to promptly initiate the transfer of funds to and from appropriate accounts, while the paper checks, at a remote location and typically lagging in time, are scanned to create digital image files and deposited as an image or substitute check if deemed ACH ineligible. The method provides for the comparison of data files to image files, based on MICR information, to find any unmatching or mismatched items for exception processing and a process to manage ACH-ineligible items as an image or substitute check. The system and method further provides for sorting exceptions according to transaction type (ACH eligible versus ACH-ineligible) and prioritizing the further processing of the exceptions based on transaction type.

What is claimed is: 
     
         1 . A method for processing paper checks, comprising:
 a) receiving at a computer over a computerized network, a first merchant data file containing transaction data including transaction amounts and raw MICR information for each of a first set of paper check transactions; wherein the raw MICR information in the first merchant data file is formatted in a first MICR format as created by a first point of sale system;   b) receiving at the computer over the computerized network, a second merchant data file containing transaction data including transaction amounts and raw MICR information for each of a second set of paper check transactions; wherein the raw MICR information in the second merchant data file is formatted in a second MICR format as created by a second point of sale system;   c) identifying, at the computer, a first translation for the first MICR format by examining the first merchant data file;   d) applying via the computer the first translation to convert the raw MICR information in the first merchant data file from the first MICR format into MICR data that is formatted in a desired format;   e) identifying image MICR information for each of a plurality of digital images, the digital images being created by scanning the paper checks; and   f) associating, at the computer, each digital image with transaction data in the merchant data files by comparing image MICR information with MICR data in the desired format.   
     
     
         2 . The method of  claim 1 , wherein the first point of sale system parses the raw MICR information into component parts and divides the component parts into separate fields. 
     
     
         3 . The method of  claim 2 , wherein the translation of the parsed data into the desired format includes combining the separate fields and adding appropriate markers. 
     
     
         4 . The method of  claim 1 , further comprising
 g) identifying, at the computer, a second translation for the second MICR format by examining the second merchant data file, and   h) applying via the computer the second translation to convert the raw MICR information in the second merchant data file from the second MICR format into MICR data that is formatted in the desired format.   
     
     
         5 . The method of  claim 1 , wherein the second MICR format is in the desired format. 
     
     
         6 . The method of  claim 1 , wherein the scanning of the paper checks occurred in time after the receiving of the merchant data files. 
     
     
         7 . The method of  claim 1 , further comprising crediting a first merchant's account for the transactions in the first merchant data file before the plurality of digital images are received. 
     
     
         8 . The method of  claim 1 , wherein the receiving of the plurality of digital images is achieved by physically scanning the paper checks after receiving the merchant data files. 
     
     
         9 . The method of  claim 8 , further comprising crediting a first merchant's account for the transactions in the first merchant data file before the checks are physically scanned. 
     
     
         10 . A computerized system for processing paper checks, comprising:
 a) a data connection that receives:
 i) a first merchant data file containing transaction data including transaction amounts and raw MICR information for each of a first set of paper check transactions; wherein the raw MICR information in the first merchant data file is formatted in a first MICR format as created by a first point of sale system, and 
 ii) a second merchant data file containing transaction data including transaction amounts and raw MICR information for each of a second set of paper check transactions; wherein the raw MICR information in the second merchant data file is formatted in a second MICR format as created by a second point of sale system; and 
   b) a computer processor configured to:
 i) identify a first translation for the first MICR format by examining the first merchant data file, 
 ii) apply the first translation to convert the raw MICR information in the first merchant data file from the first MICR format into MICR data that is formatted in a desired format, 
 iii) identify image MICR information for each of a plurality of digital images, the digital images being created by scanning the paper checks; and 
 iv) associate each digital image with transaction data in the merchant data files by comparing image MICR information with MICR data in the desired format. 
   
     
     
         11 . The computerized system of  claim 10 , further comprising:
 c) a digital image scanner that scans the paper checks to create the plurality of digital images received by the computer processor.   
     
     
         12 . The computerized system  11 , wherein the data connection receives the merchant data files before the digital image scanner scans the paper checks. 
     
     
         13 . The computerized system of  claim 12 , wherein the computer processor is further configured to:
 v) submit transaction data via ACH for crediting a first merchant's account for the transactions in the first merchant data file.   
     
     
         14 . The computerized system of  claim 13 , wherein the computer processor is configured to submit the transaction data via ACH before the receiving the plurality of digital images. 
     
     
         15 . The computerized system of  claim 14 , wherein the digital image scanner scans the paper checks after the data connection receives the merchant data files. 
     
     
         16 . The computerized system of  claim 15 , wherein the computerized processor submits transaction data via ACH before the digital image scanner scans the paper checks. 
     
     
         17 . A method for processing paper checks, comprising:
 a) receiving, at a payment processor computer, a plurality of ACH-eligible transaction records from a plurality of merchants;   b) submitting ACH transactions described in the ACH-eligible transaction records to an ACH network for processing;   c) after step b), scanning the paper checks received from the plurality of merchants with a digital image scanner to create image records of the paper checks, the image records containing check images created by the digital image scanner; and   d) comparing, at the payment processor computer, the image records with the ACH-eligible transaction records to find matches.