Method for administering a credit card with a finance charge waiver period

• US 7,401,045 B2
• Filed: 03/05/2001
• Issued: 07/15/2008
• Est. Priority Date: 03/05/2001
• Status: Active Grant

• Current Assignee: Capital One Services LLC (Capital One Financial Corporation)
• Original Assignee: Capital One Financial Corporation
• Inventors: Ogle, Catherine Leicester, Kingston, Kevin Dale, Zamsky, Michael, Joseph, Derrick, Mitro, Janet M., Iyer, Vijesh V.
• Primary Examiner(s): Poinvil; Frantzy
• Assistant Examiner(s): Graham; Clement
• Application Number:
  US09/797,678
• Publication Number:
  US 20020165808A1
• Time in Patent Office: 2,689 Days
• Field of Search: 705/41, 705/14, 705/37, 705/38, 705/36, 705/39, 705/68, 705/70, 705/35, 705/42, 705/26, 395/214
• US Class Current: 705/37
• CPC Class Codes: G06Q 20/14 specially adapted for billing systems
• CPC Class Codes: G06Q 20/24 Credit schemes, i.e. "pay after"
• CPC Class Codes: G06Q 20/403 Solvency checks
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

Method and systems for administering a credit card account are disclosed. The method comprises defining a finance charge waiver period for each one or more debits to the credit account. For each debit, it is determined whether a finance charge waiver period associated with a debit has expired. Debits for which the finance charge waiver period has expired are added to a set of billed charges. Finance charges accrue against all debits for which finance charge waiver period has expired. Optionally, a customer may be provided with advance notice of debits for which the finance charge waiver period will soon be expiring.

Claims

1. A computer-implemented method of administering a credit card account, comprising:

defining a finance charge waiver period for debits to the credit card account, the finance charge waiver period comprising more than one billing cycle;

electronically determining, for each debit, whether a finance charge waiver period associated with the debit has expired; and

electronically adding, to a set of billed charges, all debits for which the finance charge waiver period has expired,

wherein finance charges accrue against all debits for which the finance charge waiver period has expired.

2. The method of claim 1 wherein the debits arise from at least one of a purchase segment, a balance transfer segment, a fees segment, or a cash advance segment.

3. The method of claim 2 wherein the finance charge waiver period is only provided for the purchase segment.

4. The method of claim 2 wherein the finance charge waiver period is only provided for the balance transfer segment.

5. The method of claim 2, further comprising:

independently setting a length of the finance charge waiver period for debits associated with a purchase segment, a balance transfer segment, a fees segment, and a cash advance segment.

6. The method of claim 1 wherein the finance charge waiver period comprises four billing cycles.

7. The method of claim 6 wherein the finance charge waiver period applies only to the one or more debits from a purchase segment.

8. The method of claim 1 further comprising:

receiving a payment for the credit card account; and

applying each payment to debits on a first-in, first-out (FIFO) basis.

9. A computer-implemented method of administering a credit card account, comprising:

defining a finance charge waiver period for debits to the credit card account, the finance charge waiver period comprising more than one billing cycle;

electronically determining, for each debit, whether a finance charge waiver period associated with the debit will expire during a next billing cycle; and

electronically adding, to a set of billed charges, all debits for which the finance charge waiver period will expire during the next billing cycle,

wherein a cardholder may pay off each debit by the end of the finance charge waiver period without incurring any finance charges on the one or more debits.

10. The method of claim 9 wherein a cardholder'"'"'s failure to pay off one or more debits before the end of the finance charge waiver period results in finance charges based only on each of the one or more debits the cardholder did not pay off.

11. The method of claim 9 wherein the debits arise from at least one of a purchase segment, a balance transfer segment, a fees segment, or a cash advance segment.

12. The method of claim 11 wherein the finance charge waiver period is only provided for the purchase segment.

13. The method of claim 11 wherein the finance charge waiver period is only provided for the balance transfer segment.

14. The method of claim 9 wherein:

the debits arise from more than one of a purchase segment, a balance transfer segment, a fees segment, or a cash advance segment, and a length of the finance charge waiver period varies among the more than one of a purchase segment, a balance transfer segment, a fees segment, or a cash advance segment.

15. The method of claim 9 wherein the finance charge waiver period comprises 90 days.

16. The method of claim 9 wherein the finance charge waiver period applies only to the one or more debits from a purchase segment.

17. The method of claim 9 further comprising:

receiving a payment for the credit card account; and

applying the payment to debits on a first-in, first-out (FIFO) basis.

18. A computer-implemented method of administering a credit card account comprising:

defining a billing cycle that comprises a predetermined number of days;

defining a finance charge waiver period that comprises more than one billing cycle;

electronically grouping, for each billing cycle, a billing cycle group including a set of debits to the account for a corresponding billing cycle;

electronically determining, for each billing cycle group, whether the finance charge waiver period associated with a the billing cycle has expired; and

electronically setting billed charges based on debits in billing cycle groups for which the finance charge waiver period has expired.

19. The method of claim 18 further comprising:

calculating finance charges for the billing cycle groups for which the finance charge waiver period has expired;

billing a customer for the billed charges and finance charges.

20. The method of claim 19 wherein the finance charges comprise retroactive interest charges.

21. The method of claim 18 further comprising:

providing a customer information relating to debits associated with the finance charge waiver period that will expire after a current billing cycle.

22. The method of claim 18 wherein the finance charge waiver period comprises three billing cycles from an end date of each billing cycle.

23. A computer-implemented system for administering a credit card account with a finance charge waiver period comprising more than one billing cycle, said system comprising:

one or more virtual transaction repositories, each of the virtual transaction repositories corresponding to a billing cycle and being associated with a billing cycle closing date, and each of the one or more virtual transaction repositories holding transaction data for one or more credit card transactions made during a corresponding billing cycle;

an outstanding balance repository for holding an outstanding balance comprising a total value of billable transactions plus interest and fees; and

calculation means for calculating balances, finance charges, and fees, the calculation means calculating a total value of billable transactions based on each of the one or more virtual transaction repositories for which the finance charge waiver period has expired and adding the total value of newly-billable transactions to the outstanding balance.

24. The system of claim 23 wherein the calculation means calculates interest on the outstanding balance.

25. The system of claim 24 wherein the calculation means calculates fees on the outstanding balance.

26. A computer-implemented system for administering a credit card account with a finance charge waiver period comprising more than one billing cycle, the system comprising:

a current transactions repository for holding raw transaction data for recent billing cycles;

a customer payment master file repository for holding customer data and billing data;

a financial master files repository for holding credit card account parameters;

an unbilled billing cycle file repository for holding data from billing cycles for which the finance charge waiver period has not yet expired; and

a billing computer comprising a billing application operatively connected to the current transactions repository, the customer payment master file repository, the financial master files repository, and the unbilled billing cycle file repository for calculating billed balances.

27. The system of claim 26 wherein the financial master files repository further comprises an indicator for signifying whether or not the credit card account has the finance charge wavier period.

28. The system of claim 27 wherein the indicator signifies the length of the finance charge waiver period.

29. The system of claim 28 wherein the indicator signifies a type of transaction for which the finance charge waiver period applies.

30. The system of claim 29 wherein the type of transaction is a purchase.

31. The system of claim 29 wherein the type of transaction is a balance transfer.

32. The system of claim 26 wherein the unbilled billing cycle file repository comprises data for billing cycles for which the finance charge waiver period has not yet expired.

33. The system of claim 32 wherein the unbilled billing cycle file repository comprises one or more billing cycle balances from billing cycles for which the finance charge waiver period has not yet expired.

34. The system of claim 33 wherein the unbilled billing cycle file repository comprises one or more billing cycle ending dates from billing cycles for which the finance charge waiver period has not yet expired.

35. A computer-implemented system for administering a credit card account with a finance charge waiver period comprising more than one billing cycle, said system comprising:

current transactions storage means for storing raw transaction data for recent billing cycles;

customer payment master file storage means for storing customer and billing data;

financial master files storage means for storing credit card account parameters;

unbilled billing cycle file storage means for storing data from billing cycles for which the finance charge waiver period has not yet expired; and

computation means operatively connected to the current transactions storage means, the customer payment master file transactions storage means, the financial master files transactions storage means, and the unbilled billing cycle file transactions storage means for computing billed balances.

36. The system of claim 35 wherein the financial master files storage means further comprises indicator means for indicating a length of the finance charge waiver period.

37. The system of claim 36 wherein the indicator means indicates segments of debits for which the finance charge waiver period applies.

38. The system of claim 35 wherein the unbilled billing cycle file storage means stores data for billing cycles for which the finance charge waiver period has not yet expired.

39. The system of claim 38 wherein the unbilled billing cycle file storage means stores one or more billing cycle balances from billing cycles for which the finance charge waiver period has not yet expired.

40. The system of claim 39 wherein the unbilled billing cycle file storage means stores one or more billing cycle ending dates from billing cycles for which the finance charge waiver period has not yet expired.