System and method for processing microtransactions

• US 8,429,069 B1
• Filed: 11/21/2011
• Issued: 04/23/2013
• Est. Priority Date: 01/15/2002
• Status: Expired due to Term

• 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: Sheehan, Mark, Wallace, William, Knackstedt, Lee
• Primary Examiner(s): Weisberger, Richard C
• Application Number:
  US13/301,013
• Time in Patent Office: 519 Days
• Field of Search: 705 35- 45
• US Class Current: 705/38
• CPC Class Codes: G06Q 20/02 involving a neutral party, e.g. certification authority, notary or trusted third party [TTP]
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/12 specially adapted for electronic shopping systems
• CPC Class Codes: G06Q 20/24 Credit schemes, i.e. "pay after"
• CPC Class Codes: G06Q 20/29 characterised by micropayments
• CPC Class Codes: G06Q 20/382 insuring higher security of transaction
• 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 20/405 Establishing or using transaction specific rules
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof
• CPC Class Codes: G06Q 50/188 Electronic negotiation

Abstract

Methods and systems of the invention provide a variety of techniques for processing microtransactions. In accordance with the invention, the method starts with a customer initiating a purchase through interaction with a merchant. The purchase is associated with purchase information, which includes the particulars of the purchase, such as the purchase price. In the purchase, the customer uses a transaction account, obtained from a payment enabler. The purchase is classified as a microtransaction, if the purchase price is below a predetermined monetary amount. Thereafter, the purchase information is forwarded for processing based on the classifying, i.e., either as a regular transaction or as a microtransaction. Then, upon receipt of the purchase information by an appropriate recipient, such as an interchange entity or an alternate interchange entity, the purchase information is processed to effect the microtransaction, if so classified, between the customer and the merchant.

Claims

1. A computer-implemented method for processing microtransactions, the method comprising:

receiving, by at least one processor, a request from a customer for an attempted transaction with a merchant, the request comprising identifying information associated with a transaction account and a transaction amount, the transaction account provided by a payment enabler;

classifying, by at least one processor, the attempted transaction as a microtransaction if the transaction amount is below a predetermined monetary amount, and otherwise classifying the attempted transaction as a non-microtransaction;

submitting, via a communication interface, the transaction request for authorization by the payment enabler according to a first protocol for non-microtransactions, if the attempted transaction is a non-microtransaction;

determining, by at least one processor, an authorization requirement for the customer, and

if the authorization requirement indicates no authorization needed, approving the attempted transaction without submitting the transaction request for further authorization by the payment enabler,

otherwise, submitting the transaction request for authorization by the payment enabler according to either a second protocol for microtransactions or the first protocol for non-microtransactions.

2. The method of claim 1, wherein one or more of the steps of receiving, classifying, submitting, determining, and approving are performed by the merchant'"'"'s computer system.

3. The method of claim 1, wherein one or more of the steps of receiving, classifying, submitting, determining, and approving are performed by an interchange entity.

4. The method of claim 3, wherein the interchange entity comprises an alternate interchange entity.

5. The method of claim 1, further comprising:

receiving, from the payment enabler, one or more updates about the account status or creditworthiness of the customer.

6. The method of claim 1, further comprising:

determining a credit risk allocation between the merchant and the payment enabler, wherein the merchant assumes a risk of non-payment of an approved microtransaction of the customer if the merchant fails to communicate with the payment enabler to receive a timely update about the account status or creditworthiness of the customer.

7. The method of claim 1, wherein the customer interacting with the merchant is performed over the Internet.

8. The method of claim 1, wherein the customer interacting with the merchant is performed over a telephone network or a private network.

9. The method of claim 1, wherein the customer interacting with the merchant is performed through person-to-person interaction.

10. The method of claim 1, wherein the transaction account is associated with a payment card selected from a group consisting of:

a credit card, a debit card, a stored value card, and a smart card.

11. A computer-implemented system for processing microtransactions, the system comprising:

at least one processor, at least one storage device, and at least one communication interface, which are configured to perform the following;

receiving a request from a customer for an attempted transaction with a merchant, the request comprising identifying information associated with a transaction account and a transaction amount, the transaction account provided by a payment enabler;

classifying the attempted transaction as a microtransaction if the transaction amount is below a predetermined monetary amount, and otherwise classifying the attempted transaction as a non-microtransaction;

submitting the transaction request for authorization by the payment enabler according to a first protocol for non-microtransactions, if the attempted transaction is a non-microtransaction;

determining, by at least one processor, an authorization requirement for the customer, and

if the authorization requirement indicates no authorization needed, approving the attempted transaction without submitting the transaction request for further authorization by the payment enabler,

otherwise, submitting the transaction request for authorization by the payment enabler according to either a second protocol for microtransactions or the first protocol for non-microtransactions.

12. The system of claim 11, wherein at least part of the at least one processor, the at least one storage device, or the at least one communication interface is in the merchant'"'"'s computer system.

13. The system of claim 11, wherein at least part of the at least one processor, the at least one storage device, or the at least one communication interface is in an interchange entity.

14. The system of claim 13, wherein the interchange entity comprises an alternate interchange entity.

15. The system of claim 11, being further configured to:

receive, from the payment enabler, one or more updates about the account status or creditworthiness of the customer.

16. The system of claim 11, being further configured to:

determine a credit risk allocation between the merchant and the payment enabler, wherein the merchant assumes a risk of non-payment of an approved microtransaction if the merchant fails to communicate with the payment enabler to receive a timely update about the account status or creditworthiness of the customer.

17. The system of claim 11, wherein the customer interacting with the merchant is performed over the Internet.

18. The system of claim 11, wherein the customer interacting with the merchant is performed through person-to-person interaction.

19. The system of claim 11, wherein the transaction account is associated with a payment card selected from a group consisting of:

a credit card, a debit card, a stored value card, and a smart card.

20. A computer-implemented method for processing microtransactions, the method comprising:

receiving, by at least one processor, a request from a customer for an attempted transaction with a merchant, the request comprising identifying information associated with a transaction account and a transaction amount, the transaction account provided by a payment enabler;

classifying, by at least one processor, the attempted transaction as a microtransaction if the transaction amount is below a predetermined monetary amount, and otherwise classifying the attempted transaction as a non-microtransaction;

submitting, via a communication interface, the transaction request for authorization by the payment enabler according to a first protocol for non-microtransactions, if the attempted transaction is a non-microtransaction;

determining, by at least one processor, an authorization requirement for the customer, and

if the authorization requirement indicates no authorization needed, submitting the transaction request for authorization according to a second protocol for microtransactions,

otherwise, submitting the transaction request for authorization according to the first protocol for non-microtransactions.