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Patent: US8231055 Systems and methods for decoding card swipe signals

Updated Time: 3 Dec 2018
Patent Number  US8231055
Application Date  13 Oct 2010
Issue Date  31 Jul 2012
Assignee  Square, Inc

 Wen, Sam

International Classification  G06K7/08


Plastic cards having a magnetic stripe embedded on one side of the card are prevalent in everyday commerce. These cards are used in various transactions such as to pay for purchases by using a credit card, a debit card, or a gasoline charge card. Although magnetic stripe cards are universally used by merchants, there is no way for an individual to take advantage of the card to receive a payment from another individual (who is not a merchant) by swiping the card through a simple reader attached to his/her mobile device. 


The present invention describes a miniaturized card reader connected to a mobile device which facilitates a financial transaction between a payer and a payee. For example, one person may owe another person money for a debt, and the conventional way to pay the debt is to provide cash or a check. This invention allows the payer to swipe their magnetic stripe card through a reader connected to a mobile device. It allows anyone to become a merchant or customer without having to purchase an expensive card reader.


A new approach is proposed that contemplates systems and methods to enable an individual to complete a financial transaction by swiping a magnetic stripe card through a card reader connected to a mobile device. The size of the card reader is miniaturized to be portable for connection with the mobile device. The card reader is configured to reliably read data encoded in a magnetic strip of the card with minimum error in a single swipe and provide a signal that corresponds to the data read to the mobile device, which then decodes the incoming signal from the card reader and acts as a point-of-sale device to complete the financial transaction. Such an approach enables a person to become either a micro-merchant (payee) or a buyer/customer (payer) without having to purchase expensive card reader devices or software.

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