Process and system for the clearing and settling of transactions

• US 8,498,902 B1
• Filed: 04/26/2000
• Issued: 07/30/2013
• Est. Priority Date: 04/28/1999
• Status: Active Grant

• Current Assignee: Citicorp Credit Services Incorporated (Citigroup Incorporated)
• Original Assignee: Citicorp Development Center Incorporated (Citigroup Incorporated)
• Inventors: Kogen, Mark F., Munoz, Ramiro M.
• Primary Examiner(s): Thein, Marissa
• Application Number:
  US09/558,569
• Time in Patent Office: 4,843 Days
• Field of Search: 705/30, 705/39, 705/40, 705/36, 235/379, 235/380
• US Class Current: 705/17
• CPC Class Codes: G06Q 20/20 Point-of-sale [POS] network systems
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03

Abstract

A method and system for the clearing and settlement of funds among a plurality of participants facilitates the integration of a “closed” special purpose industry sector, such as the transit industry, within an open financial payment system. A method for clearing and settling funds among a plurality of participants comprises receiving data relating to transactions from the plurality of participants, organizing the data into groups associated with each of the plurality of participants, summing the data in the groups to determine a total funds due to and from each of the plurality of participants, and settling the difference among the plurality of participants by transferring funds to the participants owed funds and collecting funds from the participants who owe funds.

Claims

1. A method for clearing and settling funds among a plurality of participants, comprising:

receiving data by a server relating to transactions from the plurality of participants;

organizing the data by the server into groups associated with each of the plurality of participants;

summing the data in the groups by the server to determine a total funds due to and from each of the plurality of participants; and

settling a difference by the server among the plurality of participants by transferring funds to the participants owed funds and collecting funds from the participants who owe funds.

2. The method of claim 1, wherein receiving the data, organizing the data and summing the data are performed daily.

3. The method of claim 2, wherein organizing the data and summing the data are performed on a first day after a day on which the transactions occurred.

4. The method of claim 1, wherein settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds is performed on a second banking day after a day on which the transactions occurred.

5. The method of claim 1, further comprising interfacing with an open purse settlement system.

6. The method of claim 5, wherein receiving data relating to transactions comprises receiving data obtained from an interaction between an electronic purse and a card interface device.

7. The method of claim 6, wherein receiving data obtained from an interaction between an electronic purse and a card interface device comprises receiving data from a data server.

8. The method of claim 5, wherein settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds comprises sending data relating to transactions to a financial services institution.

9. The method of claim 5, wherein settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds comprises receiving funds from a financial services institution'"'"'s clearing and administration system.

10. The method of claim 9, wherein settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds comprises crediting the funds received from the financial services institution to one of the participants.

11. The method of claim 1, wherein receiving data comprises receiving data relating to transactions from at least one transit operator.

12. The method of claim 1, wherein receiving data comprises receiving data relating to transactions from at least one card issuer.

13. The method of claim 1, wherein receiving data comprises receiving data relating to transactions from at least one third party merchant.

14. The method of claim 1, wherein receiving data comprises receiving data relating to transactions from at least one transit operator, at least one card issuer and at least one third party merchant.

15. The method of claim 1, wherein the participants comprise at least one transit operator and receiving data relating to transactions comprises receiving data relating to at least one fare collection transaction.

16. The method of claim 15, wherein receiving data relating to at least one fare collection transaction comprises receiving data obtained from an interaction between a transit card and a card interface device.

17. The method of claim 16, wherein the transit card is issued by a first transit operator and the card interface device is owned by the first transit operator.

18. The method of claim 16, wherein the transit card is issued by a first transit operator and the card interface is owned by a second transit operator.

19. The method of claim 16, wherein receiving data obtained from the interaction between the transit card and the card interface device comprises receiving data obtained from the interaction between the transit card and the card interface device when a fare is purchased.

20. The method of claim 16, wherein receiving data obtained from the interaction between the transit card and the card interface device comprises receiving data obtained from the interaction between the transit card and the card interface device when a fare on the transit card is used.

21. The method of claim 15, wherein the participants further comprise an electronic purse system.

22. The method of claim 21, wherein receiving data relating to loading of at least one transit card at an electronic purse load machine comprises receiving data obtained from an interaction between an electronic purse and a card interface device.

23. The method of claim 22, wherein receiving data obtained from an interaction between an electronic purse and a card interface device comprises receiving data from a transit data server.

24. The method of claim 21, wherein settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds comprises sending data relating to at least one fare collection transaction to a financial services institution.

25. The method of claim 24, wherein settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds comprises receiving funds from the financial services institution'"'"'s clearing and administration system.

26. The method of claim 25, wherein settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds comprises crediting the funds received from the financial services institution to a transit operator.

27. The method of claim 1, wherein the participants comprise at least one transit operator and receiving data relating to transactions comprises receiving data relating to at least one loading of a transit card.

28. The method of claim 27, wherein the transit card is loaded at an add value machine owned by a first transit operator and the transit card was issued by a second transit operator.

29. The method of claim 28, wherein receiving data relating to at least one loading of a transit card further comprises receiving data from the add value machine relating to at least one loading of a transit card.

30. The method of claim 27, wherein the transit card is loaded at an electronic purse load machine.

31. The method of claim 30, wherein receiving data relating to at least one loading of a transit card further comprises receiving data from the electronic purse load machine relating to at least one loading of a transit card.

32. The method of claim 1, wherein the participants comprise at least one transit operator and receiving data relating to transactions comprises receiving data relating to at least one issuance of a transit card.

33. The method of claim 32, wherein the issuance of a transit card requires payment of a refundable deposit to a card issuer.

34. The method of claim 33, wherein the refundable deposit is payable by one of a debit card, a credit card, a check, cash or electronic cash.

35. The method of claim 34, wherein the at least one transit operator sells transit cards and collects refundable deposits using a card vending machine.

36. The method of claim 35, wherein receiving data relating to at least one issuance of a transit card comprises receiving data from the card vending machine relating to the payment of the refundable deposit.

37. The method of claim 36, wherein receiving data from a card vending machine relating to the payment of the refundable deposit comprises receiving data from the card vending machine relating to the payment of the refundable deposit upon issuance of the card when the refundable deposit is paid by one of a debit card or credit card.

38. The method of claim 35, further comprising collecting the refundable deposit using a revenue-servicing agent when the refundable deposit is paid by one of a check or cash to the at least one transit operator.

39. The method of claim 1, wherein settling the difference comprises settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds on a net settlement basis.

40. The method of claim 1, wherein settling the difference comprises settling the difference by transferring funds to the participants owed funds and collecting funds from the participants who owe funds on a gross settlement basis.

41. The method of claim 1, wherein settling the difference comprises guaranteeing the settlement of obligations of at least one third party merchant.

42. The method of claim 41, wherein guaranteeing the settlement comprises issuing a line of credit to the at least one third party merchant.

43. The method of claim 41, wherein guaranteeing the settlement comprises depositing collateral in an account.

44. The method of claim 1, wherein settling the difference by transferring funds to the participants owed funds comprises settling the difference by crediting funds to the participants owed funds through an automated clearinghouse.

45. The method of claim 1, wherein settling the difference by collecting funds from the participants who owe funds comprises receiving payments from the participants who owe funds through a revenue servicing agent.

46. The method of claim 45, wherein the transactions are a cash-based card issuance or a cash-based card load.

47. The method of claim 46, wherein the participants comprise at least one transit operator and at least one third party merchant.

48. The method of claim 1, further comprising reconciling the total funds due to and from each of the plurality of participants.

49. The method of claim 48, wherein reconciling the total funds due to and from each of the plurality of participants comprises comparing the total funds due to and from each of the plurality of participants with data relating to transaction totals based on the data relating to transactions received from the plurality of participants.

50. The method of claim 1, further comprising providing a report to each of the plurality of participants detailing the transactions and the funds transferred and collected from the participants.

51. The method of claim 50, wherein the reports comprise fare collection details sorted by transit card and fare collection details from at least one open purse system.

52. The method of claim 51, wherein the reports further comprise data relating to transfers, the loading of transit cards and chargebacks.

53. The method of claim 1, wherein the participants comprise at least one transit operator utilizing a fare-by-distance or fare-by-zone program.

54. The method of claim 53, further comprising ensuring that a transit rider has sufficient value on a transit card for a ride, deducting from the transit card a value representing a shortest available ride and setting an indicator on the transit card that a tag-off and remaining amount of funds are required.

55. The method of claim 54, wherein the ensuring, deducting and setting are performed by a card interface device.

56. The method of claim 53, further comprising deducting value from the transit card when the rider fails to properly tag off at a destination.

57. The method of claim 56, wherein deducting value comprises deducting value from the transit card when the rider next attempts to use the transit card.

58. The method of claim 57, further comprising logging the deduction of value for later processing and continuing with the current fare payment.

59. The method of claim 1, further comprising processing refunds to qualifying customers.

60. The method of claim 59, wherein qualifying customers comprise customers whose cards were lost, stolen or defective.

61. The method of claim 1, further comprising handling failed card load transactions.