Generate digital cheque/DD through ATM/Internet Banking/Mobile Banking/SMS

PCT Application Number                     : PCT/IB2018/055035
Indian Patent Application Number  : 201741025886
US Patent Application Number         : Will update soon

A negotiable instrument (also sometimes referred to as banking instrument) is a document guaranteeing the payment of a specific amount of money, either on demand, or at a set time, with the payer named on the document. More specifically, it is the document contemplated by or consisting of a contract, which promises the payment of money without condition, which may be paid either on demand or at a future date. The term can have different meanings, depending on what law is being applied and what country it is used in and what context it is used in. Most widely used negotiable instruments, amongst others, are Cheque and Demand draft (DD) and both of them are mechanisms used to make payments. The cheque is a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on demand, whereas, the demand draft is a pre-paid negotiable instrument, wherein the drawee/Payer bank acts as guarantor to make payment in full when the instrument is presented. In a financial transaction, cheque is not usually accepted as the drawer and payee are unknown and there will be credit risk. So, in such cases DD is accepted where the transfer of money is guaranteed. 

The existing payment transaction systems revolves around a few methods such as online transfer for instant transfer of funds, making payment through banking instruments like cheques, DDs, etc. In case of banking instruments where the payment order is a deferred payment order, the preferred transaction mode is through cheque where the payer's account is not debited until the cheque is presented to a drawing bank. 

Today, most of the account holders carry physical cheques, cheque books, DD forms, and/or DDs for making transactions. Accordingly, millions of cheque books or DD forms are required to be printed by each bank per year costing various environmental issues like tree cutting for generating papers or pollution while generating cheque books or DD forms and/or printing papers. Banks are investing millions only for printing the DD/cheque books and processing. Accordingly, in order to compensate, customers of the bank have to pay money for the usage and processing of the DD/cheque books and also to order for new printed DD/cheque books to the bank. Further, with growth, development and advancement of technology and intellect skills of the people, forgery cases, by manipulating (signature, amount etc. on the cheque or DD), are increasing day by day for DDs and/or cheques. Furthermore, in case of forgery cases or fraud, several civil/criminal investigations are required to recover the original money which is a time consuming process. 

Irrespective of these drawbacks, currently, the DD and cheque transactions are nearly impossible without paper printing. The existing mechanisms requires numerous pieces of paper to be passed from bank to customer, in blank, and then from customer to payee and then from payee to their own bank for processing through the inter-bank clearing system for subsequent proofing and payment. These steps are inefficient and resource intensive and value exchange can be better undertaken through more innovative methods. 

As more financial transactions are performed electronically, there is a need for facilitating transactions without the need for currency or cash. Additionally, it is often cumbersome to carry a wallet or purse with a cheque book, credit cards, cash cards, or currency. However, most people carry a mobile phone or communication device almost all the time. Therefore, it would be advantageous to provide a way to utilize a mobile phone or communication device to conduct transactions between two parties while avoiding the need for physical cash currency, credit cards, or cheque books. 

While there exists many electronic cheques (e-cheque)/DDs based transaction systems to solve most of the above mentioned problems available in the present market, however, they fail to provide an advanced technical solution for achieving a secure transaction as e-cheque/DD can be easily retrieved or obtained from the payee or the payer. 

Therefore, there still exists a dire need to provide a new, technically advanced and improved system and method enables for real-time generation of electronic negotiable instrument, such as cheque and demand draft (DD), for secure money transfer, payment and management thereof. More over this improved advanced system is proposed based on the present available technologies which means users can utilize their mobile devices or computers to generate the electronic negotiable instruments. i.e users can generate using internet banking, Mobile apps, ATM and also through simple SMS.

How it works:

The overall process is in four phases:

1. Generate the e-cheque/DD

2. Share the same with beneficiary

3. Clearing the e-cheque/DD

4. Cancel the e-cheque/DD

It should be appreciated that 3 OTP’s are generated during the overall implementation, working and processing of the requests received from payer and/or payee during the generation and/or clearance of e-cheque/DD. At least first of the 3 OTP’s may be referred to as a first OTP/OTP 1/ Unique Cheque Request Number (UCRQN) / Unique Demand Draft Request Number (UDDRQN). At least second of the 3 OTP’s may be referred to as a second OTP/OTP 2/ Unique Cheque Reference Number (UCRFN) / Unique Demand Draft Reference Number (UDDRFN). At least third of the 3 OTP’s may be referred to as a third OTP/OTP 3/Unique Cheque Clearance Number (UCCN) / Unique Demand Draft Clearance Number (UDDCN). 

Generate the e-cheque/DD: 

The process for generating the e-cheque/DD using internet banking can include the following steps: customer/payer logs into his/her mobile/internet banking portal and selects a “Generate E-cheque/DD” from menu/item/option; the customer then select either e-cheque/DD option (it may be appreciated that, the details filling form may be different for e-DD and e-cheque); The customer then fills one or more details such as but not limited to his/her account details, e-cheque/DD date, type of e-cheque to be generated, beneficiary/payee details including but not limited to payee/beneficiary/FIRM name, bank name/IFSC code, account number, and mobile number; the payer then enters a desired amount; and after filling all the required details, finally, clicks on generate/submit/proceed button; in response to the selection of the generate/submit/proceed button, OTP 1 is sent to the payer; after successful insertion of the OTP 1 of the payer and an additional CVV number or first four digits of debit card or any customized number is entered and then click on confirm button. Upon verification of both OTP 1 and additional security code, an e-cheque/DD (that may include but not limited to QR code/ Barcode or any other security code) is generated along with watermarked bank name (as background image) on e-cheque/DD, there can be an option provided to have the payer/customer signature on e-cheque but this is not mandatory; then the e-cheque/DD generated is sent to the payer’s registered email address in JPEG/PNG/PDF or any other digital formats and at the same time and OTP 2 is sent to the payee’s mobile number (the mobile number is entered in the e-cheque/DD generation details). The payer shares the received e-cheque/DD with the payee through email/Whatsapp or by any other digital communication platform. 

The process for generating the e-cheque/DD using ATM consists of following steps: payer visits the ATM and inserts his/her Debit card and authenticates himself/herself with the PIN; selects a “Generate E-cheque/DD” option from user interface of the ATM; the customer then select either e-cheque or e-DD option (it may be appreciated that, the details filling form may be different for e-DD and e-cheque); enters payee/beneficiary/FIRM name, bank account number, bank name/IFSC code and mobile number; enter a desired amount; clicks on “Generate/Submit/Proceed” button from user interface of the ATM; OTP 1 is sent to the payer; after successful insertion of the OTP 1 of the payer and an addition CVV number or first four digits of debit card or any customized number and then click on confirm button. Upon verification of both OTP 1 and additional security code, an e-cheque/DD (that may include but not limited to QR code/ Barcode or any other security code) is generated along with watermarked bank name (as background image) on e-cheque/DD, there can be an option provided to have the payer/customer signature on e-cheque but this is not mandatory; then the e-cheque/DD generated is sent to the payer’s registered email address in JPEG/PNG/PDF or any other digital formats and at the same time and OTP 2 is sent to the payee’s mobile number (the mobile number is entered in the e-cheque/DD generation details). The payer shares the received e-cheque/DD with the payee through email/Whatsapp or by any other digital communication platform. 

The process to generate an e-cheque/e-DD through an SMS (message) by a payer. The payer may send a SMS from payers’ registered mobile number to the bank SMS server and then bank server will process the request. An OTP 1 will be received by the payer and then payer may send the OTP 1 received as SMS to the bank SMS server again, for example otpv <otp1>, to bank SMS server. The bank server finally validates the beneficiary and OTP 1 details and then e-cheque/e-DD will be generated. The e-cheque/e-DD generated is then sent to payer registered email address. While the generation of e-cheque/e-DD an OTP 2 is sent to payees’ mobile number which is included in the SMS syntax. The payer may then share the generated e-cheque/e-DD with the payee. In an exemplary embodiment, the SMS sent to bank server may be of below syntax:

GenEchq/edd <last 4 digits of debit card> <pin> <cheque type> <payee name> <payeemobile number> <payee account number> <payee ifsc code> <amount>

 

Clearing the e-cheque/DD: 

The process for clearing the e-cheque/DD by visiting a bank consists of following steps: the payee shares the e-cheque/DD along with the OTP 2 to a bank employee/teller. The bank employee processes/verifies the e-cheque/DD by reading QR code/barcode (or any other security codes) available/written on the e-cheque/DD along with the OTP 2. While clearing the e-cheque/DD, OTP 3 is received by the payee and is shared with the bank employee such that he/she can successfully process and clear the e-cheque/DD upon verification. The amount is credited to the payee’s bank account, or cash is given if e-cheque is made for self. 

The process for clearing the e-cheque/DD by visiting an ATM consists of following steps: the payee visits an ATM and chooses “Clear e-cheque/DD option” from the user interface of the ATM; the customer then select either e-cheque or e-DD option; places the QR code/ Barcode (or any other security codes) of the e-cheque/DD under QR/Bar code or any other security code scanner device at the ATM; the scanner reads all details from the e-cheque/DD and auto fills a corresponding form; payee checks the details on the screen, if all the values are correct then enter/presents OTP 2 received by the payee to validate the e-cheque/DD; while the verification of the e-cheque/DD and OTP 2, OTP 3 is generated by the bank server and is received by the payee. Once the payee enters OTP 3 and clicks on confirm button/option, upon verification of the e-cheque/DD, OTP 2 and OTP 3 e-cheque/DD is cleared. The amount is credited to the payee’s bank account, or cash is dispensed by the ATM if e-cheque is made for self. 

An aspect of the present disclosure relates to clearance of e-cheque/e-DD through an SMS (message) by a payee. First the payee sends a SMS (from mobile number which is provided while e-cheque/e-DD generation) with the e-cheque/e-DD number along with the mobile number (provided while generating e-cheque/e-DD) and the OTP 2. In an example, the SMS (message) may have syntax as:

Clrchq/clrdd <echeque/dd number> <mobile number> <otp2>. 

Once send the above SMS by the payee, an OTP 3 will be received by the payee from the bank server. If payee wants to clear the e-cheque/e-DD without visiting bank or ATM then simply payee sends SMS with the OTP 3 to bank SMS server as example PRSCHQ/DD <otp3>. If the cheque is made for account payee then the amount will be credited into payee bank account automatically. If the cheque is for self and then skip the above process (sending OTP 3 to bank SMS server) and enter the otp3 in the ATM to dispense the amount. In case of payee decides to clear the cheque using ATM, then in the ATM user can see one more option to clear the cheque by SMS then it will ask to enter otp3 after validation the desired amount. Will be dispensed by the ATM. The SMS clearance feature at ATM is only valid for self cheques but not other types of cheques.

 

Cancelling the e-cheque/DD:  

The process for cancelling the generated e-cheques/DDs through mobile/internet banking consists of following steps: payer logs into the user bank account through mobile app/internet banking; selects a cancel e-cheque/DD option; selects either e-cheque or e-DD option; enter the e-cheque/DD number; if multiple e-cheques/DDs to be cancelled then enter each e-cheque/DD number separated by comma. Ex: 11111, 2222, 4444 etc.; while processing cancellation request an Unique Cheque Cancel Request Number (UCCRN)/Unique DD cancellation Request Number (UDDCRN) will be sent to a registered mobile number of login account holder or person who generated the cheque/DDs; payer enters the UCCRN/UDDCRN and click on confirm; the e-cheques/DDs will be cancelled automatically; upon cancellation an SMS will be sent to the each payee’s mobile number (person whose mobile number is included while creating the e-cheque/DD) saying that “The e-cheque/DD with <NUMBER> is cancelled”; cancellation process completed. In another aspect, the multiple e-cheques/DDs cancellation process can be treated and performed as a single transaction. 

The process for cancelling the generated e-cheques/DD through ATM consists of following steps: payer authenticate with debit/credit card and PIN at the ATM; selects a cancel e-cheque/DD option; the customer then select either e-cheque or e-DD option; enter the e-cheque/DD number; if multiple e-cheques to be cancelled then enter each e-cheque/DD number separated by comma. Ex: 11111, 2222, 4444 etc.; while processing cancellation request an Unique Cheque Cancel Request Number (UCCRN)/Unique DD cancellation Request Number (UDDCRN) will be sent to a registered mobile number of login account holder or person who generated the e-cheque/DD; payer enters the UCCRN/UDDCRN and click on confirm; the e-cheque/DD will be cancelled automatically; upon cancellation an SMS will be sent to the each payee’s mobile number (person whose mobile number is included while creating the e-cheque/DD) saying that “The cheque/DD with <NUMBER> is cancelled”; cancellation process completed. In another aspect, the multiple e-cheques/DDs cancellation process can be treated and performed as a single transaction. 

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Disclaimer: Chances are there that some one may have patents on the similar innovative ideas but all these concepts are my own individual thoughts. 

Thanks,
SPCS