Non-cash transaction incentive and commission distribution system

• US 6,105,001 A
• Filed: 08/15/1997
• Issued: 08/15/2000
• Est. Priority Date: 08/15/1997
• Status: Expired due to Term

• Current Assignee: Larry A. Masi
• Original Assignee: Larry A. Masi
• Inventors: Masi, Larry A., Fosko, Joseph J. Jr., Masi, Monica R.
• Primary Examiner(s): Trammell, James P.
• Assistant Examiner(s): Nguyen, Cuong H.
• Application Number:
  US08/912,214
• Time in Patent Office: 1,096 Days
• Field of Search: 705/14, 705/16, 705/39, 705/38, 705/36-37, 705/21, 705/30, 705/40, 705/35, 705/17
• US Class Current: 705/14.1
• CPC Class Codes: G06Q 20/02 involving a neutral party, e.g. certification authority, notary or trusted third party [TTP]
• CPC Class Codes: G06Q 20/023 the neutral party being a clearing house
• CPC Class Codes: G06Q 20/04 Payment circuits
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/204 comprising interface for record bearing medium or carrier for electronic funds transfer or payment credit
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 30/0207 Discounts or incentives, e.g. coupons or rebates
• CPC Class Codes: G06Q 30/04 Billing or invoicing

Abstract

An electronic fund transfer system is disclosed wherein commissions for point-of-sale purchase transactions are determined and distributed to members of an organizational network for promoting use of a non-cash payment device for effecting purchase transactions. Purchase data is electronically transmitted from the point-of-sale to an automated clearing house for effecting fund transfers to prepare the purchase, and also to a commission management system. The commission management system maintains an electronic database reflecting the structure of the organizational network, and further determines the distribution of purchase commissions according to a predetermined schedule of proportions relating to the position and business volume of each member of the network. The commission management system further comprises a payment processor for effecting commission payments to the members on a scheduled basis.

Claims

1. A method of distributing commissions to promote use of a non-cash payment device, comprising the steps of:

organizing an electronic database to contain member records, each member record identifying a bearer of the non-cash payment device;

establishing a hierarchy of relationships among the member records, and storing positional data in the electronic database in association with the member records;

operating a purchase processing terminal to record a purchase by one of the members bearing the non-cash payment device;

electronically transmitting transaction data from the purchase processing terminal to a commission management processor connected with the electronic database;

operating the commission management processor to determine, on the basis of the transaction data, a business volume value, and to record the business volume value in a member record identifying said one member;

determining a commission value for said one member on the basis of business volume values recorded in other member records and on the basis of the positional data relating said one member with the other members in the hierarchy; and

effecting a monetary payment in the amount of the commission value to said one member.

2. The method of claim 1, wherein said establishing step comprises establishing successive subordinate levels of member records relative to said one member within the hierarchy, to identify subordinate members recruited by said one member and to identify further subordinate members at each successive level;

and wherein said determining step comprises said commission management processor retrieving member records from each subordinate level and computing said commission value on the basis of the business volume recorded therein for each subordinate member.

3. The method of claim 2, wherein said determining step further comprises computing said commission value on the basis of a schedule of proportions associating proportional commission rates with each successive subordinate level of the hierarchy.

4. The method of claim 3, wherein said determining step further comprises computing said commission value on the basis of a predetermined schedule of qualifying business volume values.

5. The method of claim 4 wherein said determining step further comprises retrieving and consulting said schedule of qualifying business volume values to determine at least one of (i) a threshold business volume value for payment of a commission to said one member, and (ii) identifying the number of successive subordinate levels from which subordinate member records will be retrieved to determine the commission value.

6. The method of claim 1 wherein said non-cash payment device comprises a debit card, the method comprising:

operating a debit authorization processor to receive the purchase data from the purchase processing terminal and to forward the purchase data to the commission management processor;

issuing an electronic authorization signal from the debit authorization processor to the purchase processing terminal; and

transmitting, from the debit authorization processor to an automated clearing house, electronic instructions for the automated clearing house to perform an electronic funds transfer, comprising the steps of;

deducting a first monetary amount from an account owned by said one member;

crediting a second monetary amount to an account owned by a merchant from whom the purchase is made;

deducting a third monetary amount from an account owned by a merchant from whom the purchase is made, and

crediting a fourth monetary amount to an account owned by a commission management organization;

such that said first amount and second amount is equal to a purchase price, and said third amount and fourth amount is a predetermined discount applied to the purchase made from the merchant.

7. The method of claim 6 wherein said effecting payment step comprises transferring the commission value from the account owned by the commission management organization to said one member.

8. The method of claim 7 wherein said transferring step comprises printing a check payable to said one member in the amount of the commission value, and delivering the check to said one member.

9. The method of claim 7 wherein said transferring step comprises operating the automated clearing house to perform an electronic fund transfer from the account of the commission management organization to the account of said one member.

10. The method of claim 1 wherein the non-cash payment device is one of a credit card and a debit card, said non-cash payment device comprising magnetically-encoded indicia identifying said one member thereon, the operating step comprising converting said magnetically-encoded indicia into electronic purchase data for transmission to the debit authorization processor.

13. The method of claim 2 wherein the purchase processing terminal is a point of sale terminal.

14. The method of claim 1 wherein the transaction data comprises purchase data.

15. The method of claim 1 wherein the transaction data comprises discount data.

16. The method of claim 2 wherein the member is a distributor.

11. A method of promoting a non-cash payment device, comprising the steps of:

establishing hierarchical relationships among a plurality of members bearing non-cash payment devices;

recording the hierarchical relationships established among the members as positional data within an electronic database maintained by a commission management processor;

conducting electronic purchase transactions by the members using the non-cash payment devices at a plurality of locations remote from the commission management processor, and electronically transmitting purchase data to the commission management processor;

determining, by the commission management processor, a commission value for each member on the basis of (i) the purchase data pertaining to electronic purchase transactions made by other members, and (ii) the positional data relating each member to the other members in the electronic database; and

effecting a monetary payment to each member in the amount of the commission value.

12. The method of claim 11 wherein said establishing and recording steps comprises the steps of:

each member recruiting new members and/or distributors to apply for the non-cash payment device;

each new member completing an application identifying a selected member or distributor responsible for recruiting the new member; and

creating a new member record in the electronic database to reflect a recruitment relationship between said new member and the selected member.