Check based online payment and verification system and method

A method for verifying a check that is being used for an on-line transaction, comprising:

• entering in by a customer using a computer, data obtained from a MICR line of the check, the data including a one-way hash value that is based on the data provided on the MICR line as well as private data not provided on a face of the check, the private data being a numerical value previously provided by the customer and that is stored in a database accessible by a check verifier;
• receiving by a web server of a merchant for which the customer seeks to make the on-line transaction, the data entered by the customers the data being received by way of a computer network;
• transmitting by the web server of the merchant to the check verifier by way of the computer network the data entered by the customer;
• and verifying by the check verifier, whether or not the check is valid wherein the verifying is performed by the check verifier computing a hash value based on the data entered by the customer and provided to it by the web server, as well as private data of the customer that is obtained from the database accessible by the check verifier wherein the entering in step includes entering in the private data by the customer, wherein the check verifier verifies the check based on the computed hash value, and the check verifier authenticates the customer by comparing the private data entered by the customer with the private data obtained from the database, to determine if there is a match.

A system for verifying a check that is being used for an on-line transaction made over a computer network, comprising:

• an input unit for receiving, from a customer, MICR data obtained from a MICR line of the check and private data of the customer, the MICR data including first MICR data that corresponds to bank account information and second MICR data that includes a one-way hash value that is computed based on the first MICR data and the private data of the customer that is not provided on a face of the check, the private data being a numerical value previously provided by the customer and that is stored in a database accessible by a check verifier;
• a web server for receiving the MICR data and the private data from the input unit, as well as transaction data corresponding to a desired on-line transaction to be made by the customer, the MICR data and the private data and the transaction data being received by the web server by way of the computer network;
• and the check verifier for receiving, by way of the computer network as output by the web server, the private data provided by the customer via the input unit and the MICR data provided by the customer via the input unit, wherein the check verifier verifies the check based on the computed hash value, and the check verifier authenticates the customer by comparing the private data entered by the customer via the input unit and provided to the check verifier by the web server, with the private data obtained by the check verifier directly from the database, to determine if there is a match.