Patent 5,220,501

(Granted 6/15/93)

Under U.S. Patent No. 5,220,501, Online Resources has exclusive rights to process various real-time electronic Automatic Teller Machine (ATM) network-based debit transactions for consumers using -home terminals to purchase goods or services, pay bills and/or do home banking.

Real-time debiting reduces the risk of non-sufficient funds (NSF). By immediately debiting consumers' accounts, Online ensures to financial institutions and merchants that funds are available. Ultimately, the consumer pays for the "premium" charged by processors to cover the NSF costs. Thus, real-time debiting should ultimately reduce the costs of transactions to consumers, as those cost savings will be passed on by competitive businesses.

Real-time debiting allows consumers to pay their bills closer to the due date. Consumers sending a check must allow a few days for mailing and paper processing and batch electronic transaction systems can require several days to clear.

Real-time processing provides consumers with better financial account control because balances and funds available are always up-to-date. Better control enables consumers to move money effectively and timely to gain the greatest return.

Online's strategy is to use its patented process to help move the financial industry forward and to collaborate with other systems being developed for electronic commerce.

Patent 6,202,054

(Granted 3/13/01)

After additional examination by the US Patent Office, Online Resources Corp. was granted a second U.S. patent for its innovative payment processing that significantly lowers the cost of Internet transactions. US Patent No. 6,202,054 grants Online Resources additional exclusive rights over various PIN (personal identification number) based or PIN-less debit or credit financial transactions requested from a user's home or office and processed using an interbank financial services network. Given the limitations of this simple summary, interested parties are referred to the patents themselves (available over the Internet on the US Patent Office's website, www.uspto.gov) for more detailed information about what the patents disclose and cover.

By granting Online Resources its second U.S. payment processing patent, the U.S. Patent and Trademark Office (PTO) further recognized the company's innovative method for providing safe, convenient, low-cost payments over the Internet. The techniques patented by Online Resources can take advantage of existing banking infrastructure, which carries millions of ATM and point-of-sale transactions daily. Online Resources' '054 patent was approved under the PTO's March 2000 policy, which increased the scrutiny of so-called "business method" patents.

Some examples where Online Resources' patented techniques and arrangements can provide significant benefits in Internet-based applications include:

• Internet Shopping - reduces costs versus credit card and off-line debit
• Bill payments - reduces costs substantially and speeds delivery of payments
• Person-to-person payments - this rapidly developing segment would benefit greatly from the payment guarantee and increased trust provided by the patented method, particularly in auctions
• Inter-bank funds transfers - moving funds in real-time between accounts at multiple financial institutions, especially for customers of account aggregation services
• Stored value applications - moving guaranteed funds over the Internet to stored value cards (e.g. gift cards, transit cards, travelers checks, etc.) offers lower processing costs, as well as providing added the convenience of reloading through the Web
• Authentication and Credit Enhancement - can be used to authenticated and authorize and use real-time account balance information for credit enhancement

Contact:

Dan Thomas, Strategic Development
Online Resources Corp.
4795 Meadow Wood Lane
Chantilly, VA 20151
(703) 653-3100
dant@orcc.com