Patent Application
20190095915
The present invention relates to an improved system and method for managing recurring payments.
Authorized recurring payments benefit consumers and merchants by automating payment for goods and/or services the consumer has previously agreed to purchase on a regular and recurring basis. A recurring payment may be a fixed amount (e.g., for an annual subscription), or it may be a variable amount based upon usage.
To take advantage of authorized recurring payments, the consumer must provide authorization to the merchant to automatically process the recurring payment and access the consumer's designated payment method for the authorized amount. Authorized recurring payments are then processed by the merchant at a predefined frequency or when the balance in the account reaches a certain threshold. Typical examples include subscription services like NetFlix®, EasyPass®, or PlayStation® LinkedIn® annual memberships. The consumer benefits by maintaining continuity of service with ensured payment of service/membership fees. The merchant benefits from guaranteed and regular payment of service/membership fees.
However, for consumers it may be a case of “out of sight, out of mind,” with consumers not paying attention to such recurring payments—specifically, to the amount of such payments. It is possible that a merchant increases the amount of a recurring payment without permission from the consumer and by only notifying the consumer via a monthly statement. It is also possible that a consumer is unaware of such an increase. Having been previously authorized by the consumer, the now increased recurring payment if processed automatically. Unless a consumer chooses to be involved in the recurring payment process by reviewing monthly statements, control of the process rests mainly with the merchant to the extent that a merchant can increase a subscription fee and process recurring payments without consumer approval.
It is also a challenge for a consumer to manage multiple recurring payments. Each recurring payment is managed by the specific merchant with whom the consumer has contracted for services/membership, and for whom the consumer has authorized a recurring payment. It is not uncommon for a consumer to have such relationships and to have provided such authorization to a plurality of merchants. Each merchant provides and manages its own recurring payment system, and interacts directly with consumers. Managing these relationships and authorization by a consumer requires the consumer to engage directly with each merchant. Such a task can easily become daunting and unmanageable for consumers.
The present invention is directed to a system and method for managing a recurring payment between a merchant and a consumer. In accordance with embodiments of the present invention, a recurring payment management (RPM) system is an interface between a consumer and one or more merchant recurring payment systems. Using a specific system architecture, arrangement and operation of various components, the present invention achieves an unconventional technological solution to a technical problem. The unconventional technological solution is in providing a gatekeeper between a consumer and a plurality of merchant recurring payment systems—a one (consumer) to one (RPM system) to many (merchants)—that will require consumer authorization before a recurring payment is processed when the merchant has changed the amount of the payment. The system and method of the present invention are operationally and structurally different from the prior art. Operationally, the present invention establishes a new relationship between the consumer and merchant for recurring payments. Currently, it is a one (consumer) to many (merchant) relationship that places the burden on the consumer to ensure the recurring payments are in line with what the consumer had initially authorized with each merchant. With the present invention, the operational relationship is one (consumer) to one (RPM system) to many (merchants), shifting the burden of managing the recurring payments for a plurality of merchants from the consumer to the RPM system and transferring control over management of recurring payments from the merchant to the RPM system. The consumer no longer needs to manage recurring payment relationships with a plurality of merchants, as that task is now handled by the RPM system. With the present invention, the consumer need only manage a single relationship with the RPM system. Architecturally, the present invention provides a RPM system (comprised at least of a server and database) located between the consumer and a plurality of merchants. The RPM system may reside in a cashless transaction card network (through which cashless transaction are processed, including recurring payment transactions), or elsewhere provided that the RPM system is the gatekeeper interface between the consumer and a merchant or a plurality of merchants for recurring payment transactions.
To utilize the present invention, a consumer first creates an account with the RPM system by providing at least one account (i.e., a cashless transaction card account number) to which an authorized recurring payment can be charged. The consumer also identifies at least one merchant from which a request for a recurring payment may be considered for processing by the RPM system. The consumer also provides an authorized amount for the recurring payment. Other information relating to the merchant and services provided in exchange for the recurring payment by the consumer may also be provided by the consumer. In a preferred embodiment, an issuer of the cashless transaction card (and account) is the interface with the consumer to provide access to the present invention. The issuer will enable a consumer to access the present invention, and will provide the consumer information to the RPM system.
The RPM system, in turn, creates a database entry for the consumer in a database of the RPM system. The database has a plurality of database records for a plurality of consumer cashless transaction card accounts. Each of the plurality of database records for each of the plurality of accounts has at least one merchant and a recurring payment amount limit that represents the amount approved by the consumer for a recurring payment to the identified merchant. Each database record may also have a recurring payment amount variable indicating an allowable variation of the recurring payment amount. After the consumer has established a consumer account, and the RPM system has created a database entry for the consumer, the RPM system communicates with a plurality of merchant recurring payment systems. For each consumer and consumer account in the database, the RPM system will communicate with the merchant recurring payment system for the merchant associated with the consumer account. Each time the RPM system receives a request from a merchant for a recurring payment for which a consumer has created a database entry, the RPM system of the present invention compares the amount of the recurring payment request from the merchant with the recurring payment amount limit (+/−the allowable variation) for this specific merchant and for this specific recurring payment. If the amounts are the same or, if changed, within the amount limit+/−the allowable variation, the recurring payment is authorized and processed. If the amounts are not the same, the RPM system transmits a message to the consumer indicating that a request for a recurring payment has been received for an amount that has not been authorized. The message transmitted to the consumer, in addition to advising of the situation, queries the consumer as to whether the payment is authorized. The consumer can respond by authorizing the payment once (i.e., pay this time only), authorizing the payment this time and for future requests for the same amount, or denying the payment.
The present invention thus provides an improved system and method for managing recurring payments. Advantageously, the present invention provides a RPM system between the consumer and the merchant payment systems that obviates the need for the consumer to communicate with the different merchant payment systems of each of the different merchants for which the consumer has authorized a recurring payment.
Embodiments of the present invention will now be described with reference to the following figures, wherein:
As used herein, the term “connectable” refers to various states of connection between electronic devices. For example, “connectable” refers to a physical connection between electronic devices, a wireless connection between electronic devices, a combination of a physical and wireless connection between electronic devices, a transient or episodic connection between electronic devices. As used herein the term “connectable” also refers to various states of connectivity between electronic devices such as, by way of non-limiting example, when electronic devices are not connected, when electronic devices are connecting or disconnecting, and when electronic devices are connected.
As used herein, the term “acquirer” refers to bank that processes and settles a merchant's payment card transactions, and then in turn settles those transactions with the card issuer. Merchants maintain accounts with acquirers to ensure the merchants receive payment for cashless transactions. An acquirer may function as payment gateway that provides a merchant service to authorize cashless transactions. The payment gateway may be provided by a bank to its customers, but can be provided by a specialized financial service provider as a separate service.
As used herein, the term “issuer” refers to a financial institution, bank, credit union or company that issues cashless transaction cards to consumers. As used herein the term “cashless transaction” refers to a transaction among a user using a cashless transaction card, e.g., credit card, debit card, gift card, etc., a merchant, and an issuer of the cashless transaction card. As used herein, “cashless transaction cards” refer both to physical cards, as well as to electronic accounts that do not utilize a physical card to complete a financial transaction, such as electronic wallets and other electronic payment applications.
Referring next to the drawings in detail, embodiments of the present invention will now be discussed. With reference to
To initiate a recurring payment, a consumer 30 first authorizes the merchant 10 to automatically charge the consumer 30 for services provided by the merchant 10, at 300 in
Referring next to
The present invention provides not only an improved system architecture for recurring payments, the present invention also provides improved operation of a recurring payment system. The system architecture is improved by providing a RPM system between a consumer and many merchants. This enables a consumer to easily manage a plurality of recurring payments with a plurality of merchants via a single interface with the RPM system. Operation of a recurring payment system is improved by the present invention by involving the consumer in real-time during a recurring payment transaction request to approve or deny the transaction if the amount of the recurring payment is different from the amount previously authorized by the consumer.
In accordance with embodiments of the present invention, a recurring payment management (RPM) system 20 is provided in a cashless transaction card network 90 and is comprised of a server 22 and a database 24 having a plurality of database records 80 for a plurality of consumer accounts. Each database record 80 may be for one consumer account 82 (i.e., for one consumer cashless transaction card and account number), but may contain a plurality of entries 84 for a plurality of merchants 10, each entry also having a merchant identifier for a merchant 10. Since a consumer 30 may use a cashless transaction card (i.e., an account) for purchases at a plurality of merchants 10, and consequently may authorize recurring payments for a plurality of merchants 10, the database record 80 for the consumer account 82 may contain entries for each of the authorized recurring payments with the plurality of merchants 10. Each record 80 will also contain an amount limit 86 for which the recurring payment is authorized, and may contain an allowable variation 88 of the authorized amount limit 86.
Aspects of the present invention (described in more detail below) are invoked when a merchant 10 submits a request for a recurring payment. Each merchant 10 will typically maintain a merchant recurring payment system 60 comprised of a server 62 and a database 64 having a plurality of database entries (i.e., data structures) for each of the consumers 30 that have authorized a recurring payment to the merchant 10. The database entries include particulars of the recurring payments. When a merchant 10 processes its recurring payments (at whatever periodicity), the merchant 10 transmits recurring payment requests based on instructions stored in the database 64 to its acquirer bank 70 at 12 of
If the consumer 20 has provided an instruction for this request and all future requests, as determined at step 432, the RPM system 20 determines whether the consumer 30 has approved or denied the request, at step 456. If the consumer 30 has approved the request, the RPM system 20 proceeds as described above for a consumer approved request to notify the issuer 40 at step 416, and the issuer 40 paying the merchant 10 at step 420 and notifying the consumer 30 at step 418. In addition, the RPM system 20 updates the RPM system database 24, at step 434, so that the amount limit 86 is updated to reflect the amount received in the recurring payment transaction request and approved by the consumer 30. That amount becomes a new amount limit 86 for the specific merchant 10 that transmitted the current recurring payment transaction request. If, on the other hand, the consumer 30 instruction is to deny this request and all future requests from this merchant 10 for this transaction, as determined at step 456, the RPM system 20 notifies the issuer 40 at step 436, the merchant 10 at step 438, and updates the RPM database 24 at step 434 accordingly so that all future recurring payment requests from this merchant 10 for this consumer 30 and consumer account number 82 will be denied by the RPM system 20. That is not to say that the recurring payment is cancelled with the merchant 10, but merely that future recurring payments will not be processed by the RPM system 20 in accordance with embodiments of the present invention. In addition, a consumer 30 may voluntarily opt-out of using the RPM system 20 by accessing the consumer account and editing or modifying the consumer profile.
A consumer 30 desiring to take advantage of benefits of the present invention must first have an account with the RPM system 20. A consumer 30 may create an account in the RPM system 20, or an account may be created for the consumer, e.g., using the interface 28. These options are depicted in
Alternatively, and as depicted in
As a further embodiment, and as depicted in
If the consumer 30 denies the change request, the replicated data structure 1002 on the database 24 is not updated and the merchant may be notified. The final data structure 1006 may be created on the database 64 as a re-creation of the original data structure 1000, if the merchant seeks to continue with the payment terms, as unchanged, with possible deletion of the replicated data structure 1002 on the database 24. The consumer 30 may be given the option to altogether cancel the recurring payment. If so, the replicated data structure 1002 is deleted from the database 24 with no further action relative thereto.
Referring next to
The server 100 further includes a display 150, input device(s) 160 (e.g., a keyboard), cursor control device(s) 170 (e.g., a mouse), signal generation device(s) 190 (e.g., a speaker or remote control), and network interface device(s) 140 that enable the server 100 to selectively connect to and with a network 90 and send or receive voice, video or data, and to communicate over the network 90 as controlled by the program of instructions 120.
The memory 130 and disk drives 180 each comprise computer-readable medium 182 that may each include a single medium or multiple media (e.g., a centralized or distributed database, and/or associated caches and servers) that store the one or more programs of instructions 120. As used herein, the term “computer-readable medium” means and includes, but is not limited to, solid-state memories such as a memory card or other package that houses one or more read-only (non-volatile) memories, random access memories, or other re-writable (volatile) memories; magneto-optical or optical medium such as a disk or tape; and/or a digital file attachment to e-mail or other self-contained information archive or set of archives that is considered a distribution medium equivalent to a tangible storage medium. Accordingly, the embodiment is considered to include anyone or more of a tangible computer-readable medium or a tangible distribution medium, as listed herein and including art-recognized equivalents and successor media, in which the software implementations herein are stored. The term “computer-readable medium” also means and includes any medium that is capable of storing, encoding, or carrying a set of instructions in the general purpose software 122 and in the special purpose software 124.
Although the present specification may describe components and functions implemented in the embodiments with reference to particular standards and protocols, the disclosed embodiments are not limited to such standards and protocols.
In accordance with various embodiments, the present invention may be implemented as one or more software programs running on one or more computing devices and one or more computer processors. Dedicated hardware implementations including, but not limited to, application specific integrated circuits, programmable logic arrays and other hardware devices can likewise be constructed to implement the present invention. Furthermore, alternative software implementations including, but not limited to, distributed processing or component/object distributed processing, parallel processing, or virtual machine processing can also be constructed to implement the present invention.
As used herein, the term “connectable” refers to various states of connection between electronic devices. For example, “connectable” refers to a physical connection between electronic devices, a wireless connection between electronic devices, a combination of a physical and wireless connection between electronic devices, a transient or episodic connection between electronic devices. As used herein the term “connectable” also refers to various states of connectivity between electronic devices such as, by way of non-limiting example, when electronic devices are not connected, when electronic devices are connecting, and when electronic devices are connected.
Modifications to embodiments of the present invention are possible without departing from the scope of the invention as defined by the accompanying claims. Expressions such as “including,” “comprising,” “incorporating,” “consisting of,” “have,” “is,” used to describe and claim the present invention are intended to be construed in a non-exclusive manner, namely allowing for articles, components or elements not explicitly described herein also to be present. Reference to the singular is to be construed to relate to the plural, where applicable.
Although specific example embodiments have been described, it will be evident that various modifications and changes may be made to these embodiments without departing from the broader scope of the inventive subject matter described herein. Accordingly, the specification and drawings are to be regarded in an illustrative rather than a restrictive sense. The accompanying drawings that form a part hereof, show by way of illustration, and not of limitation, specific embodiments in which the subject matter may be practiced. The embodiments illustrated are described in sufficient detail to enable those skilled in the art to practice the teachings disclosed herein. Other embodiments may be utilized and derived therefrom, such that structural and logical substitutions and changes may be made without departing from the scope of this disclosure. This Detailed Description, therefore, is not to be taken in a limiting sense, and the scope of various embodiments is defined only by the appended claims, along with the full range of equivalents to which such claims are entitled.
