System and method for providing a discount credit transaction network

• US 6,014,635 A
• Filed: 12/08/1997
• Issued: 01/11/2000
• Est. Priority Date: 12/08/1997
• Status: Expired due to Term

• Current Assignee: SHC Direct Incorporated
• Original Assignee: SHC Direct Incorporated
• Inventors: Harris, Jeffrey, Purdy, James, Kirschner, Douglas
• Primary Examiner(s): MacDonald, Allen R.
• Assistant Examiner(s): Myhre, James W.
• Application Number:
  US08/986,877
• Time in Patent Office: 764 Days
• Field of Search: 705/14, 705/39, 705/44
• US Class Current: 705/14.17
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/387 Payment using discounts or coupons relating to marketing G06Q30/02
• CPC Class Codes: G06Q 20/40 Authorisation, e.g. identification of payer or payee, verification of customer or shop credentials; Review and approval of payers, e.g. check credit lines or negative lists
• CPC Class Codes: G06Q 30/0215 Including financial accounts
• CPC Class Codes: G06Q 30/0225 Avoiding frauds
• CPC Class Codes: G06Q 30/0235 constrained by time limit or expiration date
• CPC Class Codes: G06Q 30/0236 Incentive or reward received by requiring registration or ID from user
• CPC Class Codes: G06Q 30/0239 Online discounts or incentives
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions

Abstract

A system and method for providing a discount for a credit-based transaction. The system includes a discount credit network wherein a participant holding a transaction card account issued by a card issuer is assigned a membership number that is associated with the participant'"'"'s transaction card account. The preferred discount credit system also includes a discount authorization processor that is operatively connected to the discount credit network having a database containing the membership numbers and their associated transaction card accounts and processing means for correlating the membership numbers to such associated transaction card accounts. The preferred discount authorization processor is operatively connected to receive discount authorization requests from authorized merchants, correlate such requests to an associated transaction card account and transaction card issuer, and issue a transaction request to that particular transaction card issuer. The discount authorization processor receives an authorization response signal from the transaction card issuer and forwards such authorization response signal to the merchant who then applies the discount to the transaction whereby the participant receives a discount for initiating the transaction through the discount credit network.

Claims

1. A method for providing a discount for a credit transaction, for use in a discount credit network comprising a plurality of transaction card issuers each having a plurality of participants holding a transaction card account issued by the card issuer, the method comprising the steps of:

(a) assigning each participant a membership number wherein the membership number is associated with the particular participant'"'"'s transaction card account;

(b) providing a computerized discount authorization processor operatively connected to the discount credit network comprising;

(i) a database containing the membership numbers and their associated transaction card accounts; and

(ii) processing means for correlating the membership numbers to their associated transaction card accounts and transaction card issuers;

(c) presenting, by the participant, the membership number to an authorized merchant for a transaction;

(d) issuing a first discount authorization request from said authorized merchant through the discount credit network to the discount authorization processor, wherein the first discount authorization request includes transaction data comprising the particular participant'"'"'s membership number and an amount for the transaction;

(e) correlating the membership number to its associated transaction card account and transaction card issuer;

(f) issuing a second discount authorization request to the transaction card issuer associated with the transaction card account through the credit network, the second discount authorization request comprising the particular participant'"'"'s transaction card account and the amount of the transaction;

(g) receiving, by the discount authorization processor, an authorization response signal from the transaction card issuer, said signal indicating a response to the proposed transaction; and

(h) forwarding the authorization response signal to the authorized merchant.

2. The method of claim 1 further comprising the step of applying the discount to the transaction whereby the participant receives a discount for initiating the transaction through the discount credit network.

3. The method of claim 1 wherein step (d) further comprises issuing a first discount authorization request from said authorized merchant to a merchant bank wherein the first discount authorization request includes transaction data comprising the particular participant'"'"'s membership number and an amount for the transaction and routing said first discount authorization request through the discount credit network from the merchant bank to the discount authorization processor.

4. The method of claim 1 wherein the membership number comprises a bank identification number assigned by a VISA®

credit card system, thereby allowing the method to utilize a VISA®

credit transaction network.

5. The method of claim 1 further comprising the step of verifying that the discount authorization request originated with an authorized merchant.

6. The method of claim 1 further comprising the step of verifying that the membership number associated with the particular participant is in good standing.

7. The method of claim 1 further comprising the step of periodically generating a consolidated statement of the transactions utilizing a particular membership number during the period, wherein the statement shows the discount applied to each such transaction.

8. The method of claim 1, wherein the discount authorization processor includes database means for storing authorization parameters, the authorization parameters comprising a transaction limit amount whereby only transactions falling below the limit will be authorized and a database of historical transaction information related to each membership number, and wherein the authorization response signal received from the transaction card issuer indicates that the transaction card issuer has not approved the transaction, the method further comprising the step of:

generating an authorization response signal within the discount authorization processor, wherein the response signal is based on the authorization parameters.

9. The method of claim 1, wherein step (a) comprises the step of actively receiving a request for a membership number from a participant, wherein the membership number is associated with the particular participant'"'"'s transaction card account.

10. The method of claim 1 further comprising the steps of:

(a) recording information related to each transaction, the information comprising the membership number, the transaction card account, and the amount of the transaction;

(b) issuing a credit transaction through the discount credit network to post the discount to the participant'"'"'s transaction card account; and

(c) issuing a payment request to the card issuer for the amount of the transaction through the discount credit network.

11. The method of claim 10 further comprising the step of invoicing the authorized merchant for a commission for participating in the discount credit transaction.

16. The method of claim 1, wherein the discount authorization processor includes database means for storing authorization parameters, the authorization parameters comprising a transaction limit amount whereby only transactions falling below the limit will be authorized and a database of historical transaction information related to each discount account number, and wherein the authorization response signal received from the transaction card issuer indicates that the transaction card issuer has not approved the transaction, the discount authorization processor further comprising means for generating an authorization response signal based on the authorization parameters.

12. A system for providing a discount to a credit transaction comprising:

(a) a database comprising a plurality of membership numbers assigned to a plurality of participants, wherein each membership number is associated with a transaction card account and wherein each membership number comprises a bank identification number assigned by a VISA®

credit card system, thereby allowing the membership number to be processed by a VISA®

credit transaction network;

(b) an authorized merchant having means for generating a discount authorization request, the discount authorization request comprising a particular membership number and an amount for the credit transaction; and

(c) a computerized discount authorization processor operatively connected to receive the discount authorization requests, the discount authorization processor comprising;

(i) logic means for correlating the membership number to its associated transaction card account;

(ii) means for generating a transaction request to one of a plurality of transaction card issuers associated with the transaction card account, the transaction request comprising the particular participant'"'"'s transaction card account and the amount of the transaction;

(iii) means for receiving an authorization response signal from the transaction card issuer, said response signal indicating a response to the proposed transaction; and

(iv) means for applying the discount to the transaction whereby the participant receives a discount for initiating the transaction.

13. The system of claim 12 wherein the discount authorization processor further comprising means for verifying that the discount authorization request originated with an authorized merchant.

14. The system of claim 12 wherein the discount authorization processor further comprises means for verifying that the membership number associated with the particular participant is in good standing.

15. The system of claim 12 wherein the discount authorization processor further comprises means for periodically generating a consolidated statement of the transactions utilizing the membership number during the period, wherein the statement shows a discount applied to each such transaction.

17. The system of claim 12 further comprising means for actively receiving a request for a membership number from a participant, wherein the membership number is associated with the particular participant'"'"'s transaction card account.

18. The system of claim 12 further comprising:

(a) means for recording information related to each transaction, the information comprising the membership number, the transaction card account, and the amount of the transaction;

(b) means for issuing a credit transaction through the discount credit network to post the discount to the participant'"'"'s transaction card account; and

(c) means for issuing a payment request to the card issuer for the amount of the transaction through the discount credit network.