Method and system for facilitating electronic funds transactions
First Claim
1. A system for facilitating electronic funds transactions between a cardholder and a participating merchant, comprising:
- a debit card having a card number and containing point of sale readable account information, as part of a plurality of said debit cards issued to consumers within a merchant-based debit card program;
said card number beginning with a unique International Standards Organization (ISO) identification number assigned for the given merchant based debit card network to which transactions are routed for processing;
said debit card is issued by a merchant, participating in said merchant-based debit card program as an issuing merchant, to a qualified consumer;
said qualified consumer becomes a cardholder having a privilege under said debit card program to execute purchase transactions at a plurality of merchants participating in said merchant-based debit card program as acquiring merchants in response to submitting valid demand deposit account (DDA) information for a checking account of the cardholder;
a network enabled computer having a debit card data base of cardholder information, information on participating acquiring merchants, and merchant information associated with a plurality of issuing merchants participating in said merchant-based debit card program;
said network enabled computer is adapted for communication through conventional card processing services and point of sale transaction terminals at participating acquiring merchants; and
programming associated with said computer for,receiving transaction information through said conventional card processing services from point of sale transaction terminals in response to an attempted purchase transaction by said cardholder using said debit card,verifying cardholder identity associating a personal identifier with customer information from said data base,issuing a declined message and terminating card processing if the card is invalid or the requested transaction falls outside the limits of card usage, accepting said transaction executing said debit transaction for the checking account associated with the cardholder DDA utilizing an automated clearing house (ACH) network,settling the transaction at a time subsequent to the execution of said transaction through a card processing service from funds retained within the associated checking account,charging the acquiring merchant a fee for executing said transaction, andremitting a portion of said charged fee to the issuing merchant of said merchant based debit card.
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0 Petitions
Accused Products
Abstract
A method and system for executing electronic funds transactions using a merchant based debit (MBD) card in a merchant-centric system that provides for reduced fees to acquiring merchants and remitting a portion of the collected fees to issuing merchants. The system also preferably provides information sharing on consumer transactions with merchants to facilitate consumer based incentive programs and the like. The system operates over conventional card processing infrastructure and utilizes the ACH network, or equivalent, to settle the transaction from a consumer checking account, or a merchant account in the case of a prepaid MBD card. Using the system, merchants may elect to qualify customers based on their own criterion. A portion of the interchange fee is distributed to the issuing merchant associated transaction executed using the merchant based debit card. Embodiments are described for prepaid, fixed value, programmable, and refillable, forms of merchant based debit cards.
433 Citations
29 Claims
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1. A system for facilitating electronic funds transactions between a cardholder and a participating merchant, comprising:
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a debit card having a card number and containing point of sale readable account information, as part of a plurality of said debit cards issued to consumers within a merchant-based debit card program; said card number beginning with a unique International Standards Organization (ISO) identification number assigned for the given merchant based debit card network to which transactions are routed for processing; said debit card is issued by a merchant, participating in said merchant-based debit card program as an issuing merchant, to a qualified consumer; said qualified consumer becomes a cardholder having a privilege under said debit card program to execute purchase transactions at a plurality of merchants participating in said merchant-based debit card program as acquiring merchants in response to submitting valid demand deposit account (DDA) information for a checking account of the cardholder; a network enabled computer having a debit card data base of cardholder information, information on participating acquiring merchants, and merchant information associated with a plurality of issuing merchants participating in said merchant-based debit card program; said network enabled computer is adapted for communication through conventional card processing services and point of sale transaction terminals at participating acquiring merchants; and programming associated with said computer for, receiving transaction information through said conventional card processing services from point of sale transaction terminals in response to an attempted purchase transaction by said cardholder using said debit card, verifying cardholder identity associating a personal identifier with customer information from said data base, issuing a declined message and terminating card processing if the card is invalid or the requested transaction falls outside the limits of card usage, accepting said transaction executing said debit transaction for the checking account associated with the cardholder DDA utilizing an automated clearing house (ACH) network, settling the transaction at a time subsequent to the execution of said transaction through a card processing service from funds retained within the associated checking account, charging the acquiring merchant a fee for executing said transaction, and remitting a portion of said charged fee to the issuing merchant of said merchant based debit card. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15)
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16. A method for executing electronic funds transactions, comprising:
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receiving of a merchant based debit card by a merchant participating in a merchant based debit card program as an acquiring merchant; said merchant based debit card having a card number beginning with a unique International Standards Organization (ISO) identification number assigned for the given merchant based debit card network to which transactions are routed for processing; said merchant based debit card issued to a cardholder which qualifies by submitting valid demand deposit account (DDA) information for a checking account and valid identification information; said merchant based debit card is received as a form of payment from a cardholder desiring to execute an electronic funds transaction in connection with a checking account held by said cardholder for which said checking account and identification information was submitted and is associated with said merchant based debit card; verifying cardholder identity by associating a personal identifier with customer related information from a database of cardholder and merchant information associated with a plurality of issuing merchants participating in said merchant based debit card program to prevent parties other than the cardholder from executing transactions with said merchant based debit card; issuing a declined message and terminating card processing if the card is invalid or otherwise unacceptable, or the requested transaction falls outside the limits of card usage; setting the transaction through automated clearing house (ACH) from funds retained within said associated checking account; charging the acquiring merchant a fee for executing said funds transaction; and remitting a portion of said charged fee to the merchant which issued said merchant based debit card to said consumer. - View Dependent Claims (17, 18, 19, 20, 21, 22, 23, 24)
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25. A system for facilitating electronic funds transactions between a cardholder and a merchant, comprising:
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a debit card containing point of sale readable account information, as part of a plurality of said debit cards issued to consumers within a merchant-based debit card program; wherein said debit card is issued by a merchant, participating in said merchant-based debit card program as an issuing merchant, to a qualified consumer that submits valid demand deposit account (DDA) information for a checking account and valid identification information; said merchant based debit card having a card number beginning with a unique International Standards Organization (ISO) identification number assigned for the given merchant based debit card network to which transactions are routed for processing; wherein said qualified consumer becomes a cardholder having a privilege under said debit card program to execute purchase transactions at a plurality of merchants participating in said merchant-based debit card program as acquiring merchants; a network enabled computer having a debit card data base of cardholder and merchant information supplied and maintained in said data base by a plurality of issuing merchants participating in said merchant-based debit card program; wherein said issuing merchants have access to said data base of cardholder information for retrieving information about consumer transactions using said merchant-based debit card and changing cardholder information within said database; wherein said network enabled computer is adapted for communication through card processing services with point of sale (POS) transaction terminals; and programming associated with said computer for, receiving transaction information from point of sale transaction terminals in response to an attempted purchase transaction by said cardholder using said debit card, verifying cardholder identity associating a personal identifier with customer information from said data base, issuing a declined message and terminating card processing if the card is invalid or the requested transaction falls outside the limits of card usage, accepting said transaction executing said debit transaction, settling the transaction at a lime subsequent to the execution of said transaction through a card processing service from funds retained within an associated checking account, charging the acquiring merchant a Tee for executing said transaction, and remitting a portion of said charged fee to the issuing merchant of said merchant based debit card. - View Dependent Claims (26, 27, 28, 29)
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Specification