US 5,220,501 · Granted 1993-06-15

The 1993 Patent That Pioneered Home Banking from Your Living Room

Imagine paying your bills and checking your bank account without leaving home—back in 1993, this patent showed how to do it using a special handheld device that connected to your bank through your phone line. Users could see their accounts on a small screen, punch in numbers, and their bank would process payments instantly, all without the bank needing to install new software.

Curated and verified by the IsItPatented Editorial team

The plain-English version

What it protects

The claim covers a complete system for remote banking: a portable terminal with a display and keypad that connects to a central computer via dial-up phone lines, exchanges financial transaction data with the user, and then routes those instructions to the bank's existing ATM or payment network. What's protected here is the specific method of letting everyday people initiate bank transfers and bill payments from home using consumer-friendly portable hardware, without requiring banks to overhaul their back-end systems.

Why it matters

This patent captures the earliest practical architecture for home banking as a mass-market service. At a time when most people had to visit a physical bank branch or ATM to move money, this invention demonstrated that remote financial transactions could work through simple consumer devices talking to existing bank infrastructure. It represents a foundational shift toward the digital financial services we take for granted today, where banking happens anywhere, anytime.

Real-world use

When you log into your bank's mobile app today to transfer money or pay a bill from your couch, you're using the same core concept this patent locked down: a personal device connecting securely to your bank to execute real-time transactions without visiting a branch.

Original USPTO abstract

A practical system and method for the remote distribution of financial services (e.g., home banking and bill-paying) involves distributing portable terminals to a user base. The terminals include a multi-line display, keys "pointer to" lines on the display, and additional keys. Contact is established between the terminals and a central computer operated by a service provider, preferably over a dial-up telephone line and a packet data network. Information exchange between the central computer and the terminal solicits information from the terminal user related to requested financial services (e.g., for billpaying, the user provides payee selection and amount and his bank account PIN number). The central computer then transmits a message over a conventional ATM network debiting the user's bank account in real time, and may pay the specified payees the specified amount electronically or in other ways as appropriate. Payments and transfers may be scheduled in advance or on a periodic basis. Because the central computer interacts with the user's bank as a standard POS or ATM network node, no significant software changes are required at the banks' computers. The terminal interface is extremely user-friendly and incorporates some features of standard ATM user interfaces so as to reduce new user anxiety.

Patent details

Publication number: US 5,220,501
Filing date: 1989-12-08
Grant date: 1993-06-15
Assignee: Online Resources, Ltd.
Inventor(s): LAWLOR; MATTHEW P., CARMODY; TIMOTHY E.
CPC class: G06Q40/02

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