Diebold Inc. is staking its claim on technologies that use cellular phones and other mobile devices to interact with automated teller machines and with other payments systems.
The North Canton, Ohio, ATM maker plans to announce today that it has received several patents for methods of
Jim Block, Diebold's director of global advanced technology, said the company has received five patents over the past 18 months or so and has more applications pending before the United States Patent and Trademark Office.
"These are adding to the ways in which you can interact with your financial institution," he said.
Perhaps the most noteworthy patent enables a bank network to receive wireless communications of information such as customer bank account numbers and account values. That might appear to make a broad claim about checking a balance wirelessly, a basic feature of nascent mobile banking services, but Diebold said this patent defines how a wireless device communicates with a bank network to dispense cash and assess a customer's account for the value of the cash dispensed.
Mr. Block said the patent covers technology "specifically to dispense cash out of the ATM." Existing wireless banking technologies largely involve "logical transactions" and the transfer of funds or information such as a balance inquiry, he said.
"Our patent portfolio in the mobile space is about physically interacting with something relating to transactions," he said. "As far as we know, no one is implementing this yet."
Bob Egan, the director of the emerging-technologies practice at TowerGroup of Needham, Mass., an independent research group owned by MasterCard Inc., said such developments are not only to be expected, but are
"I think it's a natural step in the evolution of mobile banking," he said. "It doesn't curtail development."
Mr. Egan cited the debate over "push e-mail," which had been patented by another company long before Research in Motion Ltd. popularized the technology through its BlackBerry e-mail pads.
"Ten years later, RIM finds itself in the throes of a huge lawsuit," he said. "It didn't curtail the development."
Mr. Block said years of work went into the research. The patents, the most recent of which was issued in April, are for applications the company filed two to three years ago, on research that began in the early 2000s, when banks began to develop applications for mobile devices.
Mr. Block estimated it would take three years to bring any products to market based on the patented technologies.
One patent would enable a customer to "pre-order" cash that could be withdrawn from an ATM using a mobile device. The bank would send a one-time-use authorization code to the user's phone, so they would not have to use a card or personal identification number at the ATM, Mr. Block said, which could be a more secure way to receive cash.
Another patent describes how bank ATMs could communicate with mobile devices using a cellular network or other wireless methods. Diebold said this application would allow two or more customers to conduct different transactions at the same ATM simultaneously.
Mr. Block said such technology could lead to the development of ATMs very different from today's kiosk-style machines. For example, they could feature several "fulfillment stations" for making deposits or receiving cash, so customers "don't physically compete for the same space."
One patent would let a customer use the keypad and display of a mobile device rather than the ATM's, which Mr. Block said could be useful at a drive-through ATM — customers would not have to open their vehicles' window except to take cash from the dispenser or put a check in the acceptor slot.
Among the patent applications pending is one for a system that would enable customers to use a phone camera to read bar codes in a retail store to calculate, a pay for, products, Mr. Block said. "You would be checking out as you add the things you intend to buy."
Some of Diebold's patented innovations seem to have little market-rattling potential. One patent covers a way for people to use mobile devices in a retail checkout or bank environment to make payments using secure "electronic checks" — essentially a digital template for a check that could be filled out on the phone and sent to the retailer as a digital check. "The check begins its life as an image," Mr. Block said.
That idea may have seemed viable several years ago, when Diebold began pursuing this research, but the marketplace appears to have gone in a different direction, Mr. Block acknowledged. Many financial companies are already testing ways to use phones to make payments at merchant sites, but the technology of choice seems to be contactless payment chips rather than a digital check.
