System and method for combined reconciliation of co-branded card promotion and settlement of private label card accounts

• US 7,953,653 B2
• Filed: 05/16/2007
• Issued: 05/31/2011
• Est. Priority Date: 05/16/2007
• Status: Active Grant

• Current Assignee: JP Morgan Chase Bank, N.A. (JP Morgan Chase & Co)
• Original Assignee: JP Morgan Chase Bank, N.A. (JP Morgan Chase & Co)
• Inventors: Siggers, Kent, Pletz, Tracy
• Primary Examiner(s): MILEF, ELDA G
• Application Number:
  US11/749,213
• Publication Number:
  US 20080288396A1
• Time in Patent Office: 1,476 Days
• Field of Search: 705/35, 705/38, 705/39
• US Class Current: 705/35
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes

Abstract

A system and method for combined reconciliation of co-branded card promotion and settlement of private label card accounts are disclosed. According to one embodiment, the method may include (1) establishing a first relationship with a merchant for promotion of a credit card, the first relationship including at least one merchant compensation term; (2) establishing a second relationship with the merchant for the administration of the merchant'"'"'s private label credit card transactions, the second relationship including at least one issuer compensation term; (3) receiving a first financial information related to the first relationship; (4) receiving a second financial information related to the second relationship; and (5) determining an account balance for the merchant based on at least one of the first information, the second information, the at least one merchant compensation term, and the at least one issuer compensation term. According to another embodiment, the system may include a server in communication with an issuer, a merchant and a bank card network. The server may receive a first financial information related the merchant'"'"'s promotion of a credit card and a second financial information related to the merchant'"'"'s private label credit card transactions. The system may further include a database that stores merchant compensation terms and issuer compensation terms. The system may also include a processor that determines an account balance for the merchant based on the first information, the second information, the at least one merchant compensation term, and/or the at least one issuer compensation term.

Claims

1. A method for combined reconciliation of a credit card promotion relationship and settlement of a private label credit card relationship between an issuer and a merchant, comprising:

establishing a first relationship between the issuer and the merchant for promotion of a credit card, the first relationship including at least one merchant compensation term, the at least one merchant compensation term stored in an electronic file;

establishing a second relationship between the issuer and the merchant for the administration of the merchant'"'"'s private label credit card transactions, the second relationship including at least one issuer compensation term, the at least one issuer compensation term stored in an electronic file;

receiving at least one electronic file containing a first financial information related to the first relationship;

receiving at least one electronic file containing a second financial information related to the second relationship; and

using a computer processor, determining an account balance for the merchant based on the first information, the second information, the at least one merchant compensation term, and the at least one issuer compensation term.

2. The method of claim 1, wherein the credit card is a co-branded credit card.

3. The method of claim 1, wherein the first relationship comprises an issuer-merchant relationship.

4. The method of claim 1, wherein the second relationship comprises at least one of an issuer-merchant relationship and an acquirer-merchant relationship.

5. The method of claim 1, wherein the administration of the private label credit card transactions comprises at least one of receiving applications for private label credit cards from applicants, issuing private label credit cards to approved applicants, authorizing purchases with the private label credit cards;

compensating the merchant based on the authorized purchases, invoicing the cardholders for purchases made with the private label cards, and receiving payments from cardholders.

6. The method of claim 1, further comprising:

modifying the at least one merchant compensation term stored in the merchant compensation term electronic file.

7. The method of claim 1, further comprising:

modifying the at least one issuer compensation term stored in the issuer compensation term electronic file.

8. The method of claim 1, wherein the first financial information is provided by the merchant.

9. The method of claim 1, wherein the first financial information is received from a bank card network.

10. The method of claim 1, wherein the first financial information includes an identification of at least one of a number of applications for the credit card submitted, a number of the applications for the credit card approved, a number of first uses of the credit card, a number of transactions conducted with the credit card, a dollar amount of the transactions conducted with the credit card, a number of rewards issued to the cardholders, and a value of the rewards issued to cardholders.

11. The method of claim 1, wherein the second financial information is provided by the merchant.

12. The method of claim 1, wherein the second financial information is received from a merchant.

13. The method of claim 1, wherein the second financial information includes an identification of at least one of a number of applications for the private label credit card submitted, a number of the applications for the private label credit card approved, a number of first uses of the private label credit card, a number of transactions conducted with the private label credit card, and a dollar amount of the transactions conducted with the private label credit card.

14. The method of claim 1, wherein the second financial information comprises at least one of an identification of a number of purchases at standard terms and a number of purchases under non-standard terms.

15. The method of claim 1, wherein the merchant provides at least one of the first financial information and the second financial information periodically.

16. The method of claim 1, wherein the merchant provides the first financial information and the second financial information simultaneously.

17. The method of claim 1, wherein the step of determining an account balance for the merchant based on the first and second information is performed at a period selected from the group consisting of monthly, weekly, daily, bi-daily, and hourly.

18. The method of claim 1, further comprising:

settling the merchant'"'"'s account with the issuer based on the merchant'"'"'s account balance.

45. The method of claim 1, wherein the step determining an account balance for the merchant based on the first information, the second information, the at least one merchant compensation term, and the at least one issuer compensation term results in one of a credit or debit to the merchant'"'"'s account.

46. The method of claim 1, wherein the combined reconciliation takes place on a regional basis.

19. A method for combined reconciliation of a credit card promotion relationship and settlement of a private label credit card relationship between an issuer and a merchant, comprising:

establishing a first relationship with the issuer for promotion of a credit card, the first relationship including at least one merchant compensation term;

using a computer processor, storing the at least one merchant compensation term in a merchant compensation term electronic file;

establishing a second relationship with the issuer for administration of the merchant'"'"'s private label credit card transactions, the second relationship including at least one issuer compensation term;

using the computer processor, storing the at least one issuer compensation term in an issuer compensation term electronic file;

providing at least one electronic file containing a first financial information related to the first relationship to the issuer;

providing at least one electronic file containing a second financial information related to the second relationship to the issuer; and

receiving, from the issuer, at least one electronic file containing an updated account balance for the merchant determined by the issuer using an issuer computer processor based on the first information, the second information, the at least one merchant compensation term, and the at least one issuer compensation term.

20. The method of claim 19, wherein the credit card is a co-branded credit card.

21. The method of claim 19, wherein the second relationship comprises at least one of an issuer-merchant relationship and an acquirer-merchant relationship.

22. The method of claim 19, wherein the administration of the private label credit card transactions comprises at least one of receiving applications for private label credit cards from applicants, issuing private label credit cards to approved applicants, authorizing purchases with the private label credit cards;

compensating the merchant based on the authorized purchases, invoicing the cardholders for purchases made with the private label cards, and receiving payments from cardholders.

23. The method of claim 19, further comprising:

modifying the at least one merchant compensation term stored in the merchant compensation term electronic file.

24. The method of claim 19, further comprising:

modifying the at least one issuer compensation term stored in the issuer compensation term electronic file.

25. The method of claim 19, wherein the first financial information includes an identification of at least one of a number of applications for the credit card submitted, a number of rewards issued to the cardholders, and a value of the rewards issued to cardholders.

26. The method of claim 19, wherein the second financial information includes an identification of at least one of a number of applications for the credit card submitted, a number of transactions conducted with the credit card, and a dollar amount of the transactions conducted with the credit card.

27. The method of claim 19, wherein the second financial information comprises an identification of at least one of a number of purchases at standard terms, and a number of purchases under non-standard terms.

28. The method of claim 19, wherein at least one of the first financial information and the second financial information is provided to the issuer periodically.

29. The method of claim 19, wherein the first financial information and the second financial information is provided to the issuer simultaneously.

30. The method of claim 19, wherein the updated account balance is received at a period selected from the group consisting of monthly, weekly, daily, bi-daily, and hourly.

31. The method of claim 19, further comprising:

settling the merchant'"'"'s account with the issuer based on the merchant'"'"'s account balance.

32. A system for combined reconciliation of a credit card promotion relationship and settlement of a private label credit card relationship between an issuer and a merchant, comprising:

a server in communication with an issuer, a merchant and a bank card network, the server receiving a first financial information related to the merchant'"'"'s promotion of a credit card and a second financial information related to the merchant'"'"'s private label credit card transactions;

a database for storing at least one merchant compensation term and at least one issuer compensation term; and

a processor for determining an account balance for the merchant based on the first information, the second information, the at least one merchant compensation term, and the at least one issuer compensation term.

33. The system of claim 32, wherein the credit card is a co-branded credit card.

34. The system of claim 32, wherein the first financial information is provided by the merchant.

35. The system of claim 32, wherein the first financial information is received from a bank card network.

36. The system of claim 32, wherein the first financial information includes an identification of at least one of a number of applications for the credit card submitted, a number of the applications for the credit card approved, a number of first uses of the credit card, a number of transactions conducted with the credit card, a dollar amount of the transactions conducted with the credit card, a number of rewards issued to the cardholders, and a value of the rewards issued to cardholders.

37. The system of claim 32, wherein the second financial information is provided by the merchant.

38. The system of claim 32, wherein the second financial information is received from a merchant.

39. The system of claim 32, wherein the second financial information includes at least one of a number of applications for the credit card submitted, a number of the applications for the credit card approved, a number of first uses of the credit card, a number of transactions conducted with the credit card, and a dollar amount of the transactions conducted with the credit card.

40. The system of claim 32, wherein the second financial information comprises a number of purchases at standard terms, and a number of purchases under non-standard terms.

41. The system of claim 32, wherein the merchant provides at least one of the first financial information and the second financial information to the issuer periodically.

42. The system of claim 32, wherein the merchant provides the first financial information and the second financial information to the issuer simultaneously.

43. The system of claim 32, wherein the account balance for the merchant is determined by a period selected from the group consisting of monthly, weekly, daily, bi-daily, and hourly.

44. A method for combined reconciliation of a co-branded credit card promotion relationship and settlement of a private label credit card relationship between an issuer and a merchant, comprising:

establishing a first relationship between the issuer and the merchant for promotion of the co-branded credit card, the first relationship including at least one merchant compensation term, the at least one merchant compensation term stored in an electronic file;

receiving applications for co-branded credit cards from co-branded credit card applicants;

issuing co-branded credit cards to approved co-branded credit card applicants resulting in co-branded credit card cardholders;

receiving a co-branded credit card purchase authorization request for a purchase with the co-branded credit card over a bank card network;

authorizing the co-branded credit card purchase authorization request over the bank card network;

receiving interchange fees for the purchase with the co-branded credit cards;

invoicing the co-branded credit card cardholder for the purchase made with the co-branded credit card;

receiving payments from the co-branded credit card cardholders;

establishing a second relationship between the issuer and the merchant for the administration of the merchant'"'"'s private label credit card transactions, the second relationship including at least one issuer compensation term, the at least one issuer compensation term stored an electronic file;

receiving applications for private label credit cards from private label credit card applicants,

issuing private label credit cards to approved private label credit card applicants resulting in private label credit card cardholders;

receiving a private label purchase authorization request for a purchase with the private label credit card over the issuer'"'"'s financial network;

authorizing the private label purchase authorization request over the issuer'"'"'s financial network;

invoicing the private label credit card cardholder for the purchase made with the private label card; and

receiving payments from the private label credit card cardholder;

using a computer processor, determining an account balance for the merchant based on a number of applications for co-branded credit cards received, a number of co-branded credit cards issued, a value of authorized purchase made with the co-branded credit cards, an amount of interchange fees received, a number of applications for private label credit cards received, a number of private label credit cards issued, a value of authorized purchase made with the private label credit card at standard terms, a value of authorized purchase made with the private label credit card at promotional terms;

in a single electronic transaction, issuing a credit to the merchant for a positive account balance, and debiting the merchant for a negative account balance.