Low value based acceptance cost recovery

• US 9,691,060 B2
• Filed: 10/15/2012
• Issued: 06/27/2017
• Est. Priority Date: 10/15/2012
• Status: Active Grant

• Current Assignee: Bank of America Corp.
• Original Assignee: Bank of America Corp.
• Inventors: Weigman, Scott A., Murphy, Matthew D.
• Primary Examiner(s): Zeender, Ryan
• Assistant Examiner(s): Haider, Fawaad
• Application Number:
  US13/651,634
• Publication Number:
  US 20140108168A1
• Time in Patent Office: 1,716 Days
• Field of Search: 705 16
• CPC Class Codes: G06Q 20/20 Point-of-sale [POS] network systems
• CPC Class Codes: G06Q 20/22 Payment schemes or models
• 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 30/0213 Consumer transaction fees
• 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

Methods and apparatus for recovering a transaction cost in connection with a transaction between a customer and a merchant are provided. The transaction cost may be recovered from a transaction that originates at a merchant location associated with a merchant category code. The transaction cost may be recovered from a low-value purchase. A recovery amount associated with the low-value purchase may include a fixed amount. The recovery amount associated with the low-value purchase may include a percentage of the acceptance cost. The recovery amount may be shared among two or more transaction participant. The recovery amount may be dynamically adjusted. Methods and apparatus may include providing adequate notice of changes in the recovery amount. The transaction cost may be recovered utilizing central control over network of merchant locations.

Claims

1. A point-of-sale (“

POS”

) system comprising;

a remote computer;

a dynamically configurable POS terminal at a location of a merchant, the POS terminal comprising a transceiver and is configured to activate a first electronic communication channel and transmit to the remote computer over the first channel using the transceiver, at least one of a plurality of credit card transactions initiated by customers of the merchant to pay the merchant for a plurality of purchases; and

a credit card for initiating at least one of the plurality of credit card transactions at the POS terminal for an amount less than ten dollars, the credit card comprising;

a passive radio frequency identification (“

RFID”

) tag; and

a screen;

wherein;

the remote computer comprises non-transitory computer-readable media storing computer-executable instructions which, when executed by a processor on the remote computer, activates a surcharge engine in response to receiving the at least one credit card transaction initiated using the credit card;

the surcharge engine, during a time sensitive window after the customers have initiated the credit card transactions and before charging the customers for the plurality of purchases, performs a method for recovering an interchange fee, the interchange fee being a cost imposed on the merchant to obtain funds corresponding to each of the plurality credit card transactions initiated by the customers to pay the merchant, the method comprising;

applying a first flag to each of a first number of the credit card transactions in response to determining that each of the first number of credit card transactions are;

(1) associated with a first purchase value over ten dollars, and (2) associated with an interchange fee that is less than a net profit of the merchant for each of the first purchase values;

applying a second flag to each of a second number of customer credit card transactions in response to determining that each of the second number of credit card transactions are;

(1) associated with a second purchase value under ten dollars, and (2) associated with an interchange fee that is greater than a net profit of the merchant for each of the second purchase values;

forming a ratio of the first number and the second number;

communicating with the POS terminal over the first channel and transmitting computer executable instructions from the remote computer to the POS terminal;

transferring control of a processing of the at least one credit card transaction to the executable code by instructing the POS terminal to execute the computer executable instructions received from the remote computer and thereby dynamically configuring the POS terminal during the time sensitive window to;

use the transceiver to power the passive RFID tag and extract payment instrument information from the passive RFID tag;

determine a surcharge amount based on the extracted payment instrument information;

add the surcharge amount to each of the second purchase values, the surcharge amount being a cost charged to each of the customers that initiated the second number of credit card transactions to pay the merchant; and

dynamically adjust the surcharge amount imposed by the merchant on each of the second number of credit card transactions before charging the customers such that;

when the surcharge engine determines, based on the ratio, that the second number is less than a first percentage of the first number, lowering the surcharge amount added by the POS terminal to each of the second purchase values; and

when the surcharge engine determines, based on the ratio, that the second number is greater than a second percentage of the first number, raising the surcharge amount added by the POS terminal to each of the second purchase values;

in response to adjusting the surcharge amount, using the transceiver to power the passive RFID tag;

using the transceiver to communicate the adjusted surcharge amount to each credit card via the passive RFID tag; and

instructing each credit card to display the adjusted surcharge amount on the screen;

activating a second electronic communication channel;

transmitting over the second electronic communication channel a plurality of authorization requests to charge each of the adjusted surcharge amounts to the customers that initiated the second number of credit card transactions to pay the merchant; and

in response to receiving authorization over the second communication channel, transmitting to the POS terminal computer executable instructions that configure the POS terminal to charge each of the customers the adjusted surcharge amount; and

the adjusted surcharge amount added to each of the second purchase values by the merchant is less than or equal to the interchange fee imposed on the merchant to obtain the funds corresponding to each of the plurality of second purchase values.

2. The system of claim 1 wherein, each of the first number of credit card transactions are associated with a geographic region and each of the second number of credit card transactions are associated with an online portal.

3. The system of claim 1 wherein, in the method, the raising of the surcharge amount comprises charging a fixed amount that is determined based on the profit margin associated each of the second purchase values.

4. The system of claim 1 wherein, in the method, the interchange fee comprises a merchant discount paid by the merchant and the method further comprises configuring the POS terminal to refuse to accept the second number of credit card transactions from the customers as payment for the second purchase values when, after deducting the merchant discount from the second purchase values, a profit margin associated with each of the second purchase values is below a target profit margin.

5. The system of claim 1, wherein in the method:

each of the first purchase values is associated with a first stock keeping unit (“

SKU”

) and each of the second purchase values is associated with a second SKU.

6. The system of claim 1, wherein the method further comprises:

in response to the raising or lowering of the surcharge amount, measuring an effect of the raising or lowering on the ratio;

transmitting to the POS terminal computer executable instructions that dynamically readjust the surcharge amount added to each of the second purchase values based on the effect; and

using the transceiver of each POS terminal, transmitting the readjusted surcharge amount to the credit card.