BANK DEPOSIT SYSTEM
November 19, 1957
Prior to processing in IBM's advanced electronic bank deposit accounting system, batches of intermixed paper and card checks were forwarded to an operator at an inscriber unit for placing identification and amount on the checks in magnetic ink.
Here, at IBM's completely new inscriber, the operator is shown keying in the amount from the check after having preset batch number and date on the control panel for repeat printing on every check. She then inserted the check into the check slot, depressed a motor bar, and the check was whisked into position and the amount automatically printed on it in special magnetic ink.
At the end of each batch of checks, a total was automatically printed on an adding machine tape for balancing to pre-established controls. This check inscribing operation can be performed at speeds up to 3,000 checks an hour.
The equipment was demonstrated by IBM as a part of an interim progress report on its banking program.
Poughkeepsie, N. Y., November 19 .......... International Business Machines Corporation today released an interim progress report on its development of an electronic bank deposit system. At a special demonstration for the press at the IBM Product Development Laboratory here, the company showed in action high-speed experimental equipment which automatically processed intermixed checks -- card and paper -- in random sizes.
The versatile system read paper checks for sorting, posted them to an electronic ledger, and automatically prepared customers' statements from the checks. Complete proving, sorting, listing and totalling[sic] were accomplished with only one recording of the check amount.
IBM officials emphasized that the equipment demonstrated will not be marketed. It reads a magnetic code on the top of the check. The market version of the equipment is planned to incorporate Arabic magnetic characters on the bottom edge of the check, as recommended by the Technical Sub-Committee of the American Bankers Association. The company explained that it is operating this equipment as a test and to gain systems experience.
IBM Paper Check Handling - 2
The IBM system demonstrated a high-speed computer and a vast 6,000,000-digit RAMAC disk memory unit with two entirely new IBM machines designed around the use of magnetic ink identification on paper checks. The new machines are an inscribing unit which places identification and amounts on checks in magnetic ink and a unit for sorting checks into desired sequence and reading them into the data processing system.
In the Poughkeepsie demonstration, the check inscriber and sorter-reader units were shown in use with an IBM 650 RAMAC (Random Access Method of accounting and Control) data processing system performing a complete demand deposit accounting application from paper checks. The 650 RAMAC featured a basic IBM 650 medium-sized computer with a magnetic drum memory able to store 20,000 digits; an IBM disk storage unit with a storage capacity of 6,000,000 digits able to provide for 40,000 accounts; an Inquiry Station using a modified IBM electric typewriter from which inquiries and data can be sent to disk storage and to which the 650 can send replies; and an IBM 407 accounting machine for direct printer output.
Batches of incoming paper and card checks were forwarded to the operator at the check inscriber unit. On the operator's control panel, batch numbers and dates had been preset for repeat printing on every check. The operator took a check and keyed in the amount on the keyboard. She then inserted the check into the check slot, and at a touch of the motor bar, the check was whisked into position and the amount automatically printed on the check in special magnetic ink. A transport mechanism aligned the checks automatically for absolute registration and quality impression of the magnetic printing.
IBM Paper Check Handling - 3
The check inscribing operation could be performed at speeds up to
3,000 checks an hour, depending upon the operator's dexterity. At
the end of each batch of checks, a total was automatically printed
on an adding machine tape for balancing to previously established
To post personal accounts, the checks previously sorted into the "Personal Account" group were placed in the hopper of the sorter-reader still in random account sequence. All information on the checks was read by the machine and transmitted to the 650 for automatic posting to the accounts stored in the disk storage file.
The three read-write access arms of the RAMAC disk memory busily sought the account records stored on the whirling magnetic disks and immediately posted the proper accounts with current transactions, automatically detecting any overdraft, stop payment or hold, and accumulated information for calculation of service charges. At the same time, the 407 Accounting Machine recorded each posted transaction in a journal and listed the date of last previous entry and overdrafts, stop payments and holds on the account. Up to three additional RAMAC units could be added to provide increased capacity.
IBM Paper Check Handling - 4
The operator may communicate with the entire 650 RAMAC system at any time through the central control panel at the 650 console. The IBM 838 Inquiry Station, however, is the most effective means of communication with the disk storage account file. In the demonstration, using the electric typewriter at the inquiry station, the operator was able to ask for account status at any time and obtain an immediate typed record of the entire account -- without impeding the process of account posting.
Following posting, the batch of personal checks was again placed
in the sorter-reader for automatic sorting to account sequence for
filing until time to render statements. In striking contrast to the
usual laborious manual sorting methods now in use, the batch of intermixed
checks -- paper checks of varying depths, lengths and thicknesses
-- were automatically sorted by the machine at a 900-checks-a-minute
rate. Customer statements were automatically prepared from the checks.
Original Caption by Science Service