Invoice financing and repayment

• US 9,892,458 B1
• Filed: 03/31/2015
• Issued: 02/13/2018
• Est. Priority Date: 03/31/2015
• Status: Active Grant

• Current Assignee: Block, Inc. (f/k/a Square, Inc.)
• Original Assignee: Block, Inc. (f/k/a Square, Inc.)
• Inventors: Shearer, Douglas Justin, Todd, Matthew Allen
• Primary Examiner(s): Ade, Garcia
• Application Number:
  US14/675,127
• Time in Patent Office: 1,050 Days
• Field of Search: 705 21
• CPC Class Codes: G06Q 20/14 specially adapted for billing systems
• CPC Class Codes: G06Q 20/202 Interconnection or interaction of plural electronic cash registers [ECR] or to host computer, e.g. network details, transfer of information from host to ECR or from ECR to ECR
• CPC Class Codes: G06Q 20/24 Credit schemes, i.e. "pay after"
• CPC Class Codes: G06Q 20/3223 Realising banking transactions through M-devices
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof

Abstract

A payment processing system for processing point-of-sale transactions and extending financing to merchants for invoice payment is disclosed. The payment processing system receives a request from a first merchant to generate an invoice for a second merchant. The payment processing system calculates financing terms for payment of the invoice, wherein the financing terms include repayment terms designating a portion of each transaction processed by the payment processing system for the second merchant to withhold for payment of the invoice. The payment processing system may advance payment of the invoice to the first merchant and take repayment from the portion of the withheld portion of transactions or transmit the withheld portion to the first merchant for payment of the invoice.

Claims

1. A computer-implemented method comprising:

receiving, by a payment processing system, over a network, from a plurality of mobile computing devices associated with a plurality of merchants, respectively, transaction information of transactions performed between the plurality of merchants and a plurality of buyers, each mobile computing device having a respective instance of a merchant application installed thereon for configuring the mobile computing device as a mobile point-of-sale (POS) terminal, the merchant application further configuring the mobile computing device to communicate the transaction information over the network to the payment processing system, the merchant application further configuring the mobile computing device to communicate requests for generating invoices to the payment processing system, the plurality of mobile computing devices including a first mobile computing device associated with a first merchant, a second mobile computing device associated with a second merchant, and a plurality of third mobile computing devices associated with a plurality of third merchants, respectively;

receiving, by the payment processing system, from the first mobile computing device associated with the first merchant, a request to generate an invoice to be sent to the second merchant, the first and second merchant having respective accounts with a payment processing service provider that operates the payment processing system, wherein the payment processing system is configured to process the transaction information of a plurality of transactions received from the plurality of mobile computing devices configured as mobile POS terminals by the merchant application;

calculating, by the payment processing system, invoice terms for the first merchant, wherein the payment processing system evaluates the transaction information of the second merchant received from the merchant application on the second mobile computing device to determine the invoice terms, and further determines the invoice terms based on a plurality of weighted factors provided by the first merchant via a user interface on the first merchant device, and further determines the invoice terms based on the transaction information received via the plurality of third mobile computing devices for transactions conducted by the plurality of third merchants, wherein the plurality of third merchants are determined based on at least one of;

a geographic location related to the second merchant, or a business type related to the second merchant;

transmitting, by the payment processing system, the invoice terms to the first mobile computing device associated with the first merchant;

receiving, by the payment processing system, an acceptance of the invoice terms from the first mobile computing device associated with the first merchant;

calculating, by the payment processing system, financing terms for financing payment of the invoice by the payment processing service provider to the first merchant on behalf of the second merchant, wherein the financing terms for financing payment are based on the invoice terms and a financial history for the second merchant and designate a portion of each transaction, processed by the payment processing system for the second merchant, to withhold for repayment, to the payment processing service provider, of a financed payment;

transmitting, by the payment processing system, the financing terms to the second mobile computing device associated with the second merchant;

receiving, by the payment processing system, an acceptance of the financing terms from the second mobile computing device associated with the second merchant;

in response to receiving the acceptance of the financing terms from the second mobile computing device associated with the second merchant, transmitting, by the payment processing system, the financed payment to the first mobile computing device associated with the first merchant on behalf of the second merchant for payment of the invoice according to the invoice terms; and

receiving, by the payment processing system, repayment of the financed payment from the second merchant by withholding, by the payment processing system, the portion of each transaction processed for the second merchant by the payment processing system via the second mobile computing device configured as the mobile POS terminal.

2. The computer-implemented method of claim 1, wherein the financing terms include a fee charged to the second merchant associated with the financed payment to the first merchant and a rate of repayment of the financed payment and the fee.

3. The computer-implemented method of claim 1, wherein the financing terms are further based on one or more of:

merchant account information for the second merchant,

an invoice payment history of the second merchant, or

an invoice payment history of other invoices by the plurality of the third merchants, wherein the plurality of the third merchants is located in a geographical area of the second merchant.

4. The computer-implemented method of claim 1, wherein each mobile computing device includes a payment instrument reader connected thereto to configure the mobile computing device as the mobile POS terminal, the method further comprising:

receiving, by a respective mobile computing device, from the connected payment instrument reader, payment information from a payment instrument of a respective customer for payment for a transaction between the respective customer and a respective merchant.

5. A computer-implemented method comprising:

receiving, by a payment processing system, over a network, from a plurality of mobile computing devices associated with a plurality of merchants, respectively, transaction information of transactions performed between the plurality of merchants and a plurality of buyers, each mobile computing device having a respective instance of a merchant application installed thereon for configuring the mobile computing device as a mobile point-of-sale (POS) terminal, the merchant application further configuring the mobile computing device to communicate the transaction information over the network to the payment processing system, the merchant application further configuring the mobile computing device to communicate requests for generating invoices to the payment processing system, the plurality of mobile computing devices including a first mobile computing device associated with a first merchant, a second mobile computing device associated with a second merchant, and a plurality of third mobile computing devices associated with a plurality of third merchants, respectively;

receiving, by the payment processing system, from a first mobile device associated with the first merchant, a request to generate an invoice to be sent to the second merchant;

calculating, by the payment processing system, invoice terms for the first merchant, wherein the payment processing system evaluates the transaction information of the second merchant received from the merchant application on the second mobile computing device to determine the invoice terms, and further determines the invoice terms based on the transaction information received via the plurality of third mobile computing devices for transactions conducted by the plurality of third merchants, wherein the plurality of third merchants are determined based on at least one of;

a geographic location related to the second merchant, or a business type related to the second merchant;

transmitting, by the payment processing system, the invoice terms to the first mobile computing device associated with the first merchant;

receiving, by the payment processing system, an acceptance of the invoice terms from the first mobile computing device associated with the first merchant;

calculating, by the payment processing system, financing terms for payment of the invoice, wherein the financing terms are based at least partially on the invoice terms and specify a portion of each transaction processed by the payment processing system for the second merchant to withhold for payment of the invoice;

transmitting, by the payment processing system, the financing terms to the second mobile computing device associated with the second merchant;

receiving, by the payment processing system, an acceptance of the financing terms from the second mobile computing device associated with the second merchant; and

withholding, by the payment processing system for payment of the invoice, the portion of each transaction processed for the second merchant by the payment processing system via the second mobile computing device configured as the mobile POS terminal.

6. The computer-implemented method of claim 5, wherein the financing terms include a fee charged to the second merchant.

7. The computer-implemented method of claim 5, wherein the financing terms are further based on one or more of:

merchant account information for the second merchant,

an invoice payment history of the second merchant, or

an invoice payment history of other invoices by the plurality of the third merchants, wherein the plurality of the third merchants is located in a geographical area of the second merchant.

8. The computer-implemented method of claim 5, further comprising:

transmitting, by the payment processing system, the financing terms to the first mobile computing device associated with the first merchant, wherein the financing terms include financing payment of the invoice by the payment processing system to the first merchant on behalf of the second merchant; and

receiving, by the payment processing system, an acceptance of the financing terms from the first mobile computing device associated with the first merchant.

9. The computer-implemented method of claim 8, further comprising transmitting, by the payment processing system, in response to receiving acceptance of the financing terms from the second merchant, the financed payment to an account of the first merchant for payment of the invoice.

10. The computer-implemented method of claim 9, wherein each mobile computing device includes a payment instrument reader connected thereto to configure the mobile computing device as the mobile POS terminal, the method further comprising:

receiving, by a respective mobile computing device, from the connected payment instrument reader, payment information from a payment instrument of a respective customer for payment for a transaction between the respective customer and a respective merchant.

11. The computer-implemented method of claim 5, wherein the first and the second merchant each have an account with a payment processing service provider who operates the payment processing system to process a plurality of financial transactions between the merchants and buyers via point-of-sale terminals.

12. The computer-implemented method of claim 5, further comprising:

transmitting, by the payment processing system, the financing terms to the first mobile computing device associated with the first merchant, wherein the financing terms specify that the portion of each transaction processed by the payment processing system for the second merchant to withhold for payment of the invoice is to be transferred to an account of the first merchant for payment of the invoice over time;

receiving, by the payment processing system, an acceptance of the financing terms from the first mobile computing device associated with the first merchant; and

transferring, by the payment processing system, to the account of the first merchant for payment of the invoice, the portion of each transaction processed for the second merchant to withhold for payment of the invoice.

13. The computer-implemented method of claim 12, wherein transferring the portion of each transaction processed for the second merchant to withhold for payment of the invoice includes providing an electronic deposit to the account of the first merchant.

14. The computer-implemented method of claim 12, wherein the financing terms include a fee received by the first merchant from the second merchant.

15. A mobile point-of-sale (POS) terminal for processing a financial transaction between a customer and a merchant, the POS terminal comprising:

a payment instrument reader comprising an interface configured to receive financial information from a payment instrument of the customer for payment for a transaction between the customer and the merchant; and

a mobile computing device coupled with the payment instrument reader, the mobile computing device comprising;

one or more processors;

a memory storing instructions for a merchant application, which when executed by the one or more processors, cause the one or more processors to;

receive an invoice for payment to a first merchant by a second merchant, wherein invoice terms for the invoice are based on a payment processing system evaluating transaction information of the second merchant received from the merchant application, wherein the invoice terms are further based on a plurality of weighted factors provided by the first merchant, and wherein the invoice terms are further based on transaction information received via the plurality of third mobile computing devices for transactions conducted by the plurality of third merchants, wherein the third merchants are determined based on at least one of;

a geographic location related to the second merchant, or a business type related to the second merchant;

receive, from the payment processing system, financing terms for payment of the invoice, wherein the financing terms specify a portion of each transaction processed by the payment processing system for the second merchant via the mobile POS terminal to withhold for payment of the invoice; and

transmit, to the payment processing system, a reply to the financing terms from the second merchant.

16. The POS terminal of claim 15, wherein the instructions cause the one or more processors to transmit the financial information from the payment instrument of the customer to the payment processing system for processing.

17. The POS terminal of claim 15, wherein the reply to the financing terms comprises an acceptance of the financing terms.

18. The POS terminal of claim 15, wherein the reply to the financing terms comprises a request for modification of the financing terms.

19. The POS terminal of claim 15, wherein the instructions cause the one or more processors to generate an interface to display the invoice such that the second merchant is presented with an interactive digital invoice including options to accept, reject, or request modification to the financing terms.

20. The POS terminal of claim 15, wherein the financing terms include an amount of financing that the second merchant is qualified to receive, a fee associated with the amount of financing, and a rate of repayment of the amount of financing.