Systems and methods for processing transaction data to perform a merchant chargeback

• US 20070094137A1
• Filed: 10/26/2005
• Published: 04/26/2007
• Est. Priority Date: 10/26/2005
• Status: Active Grant

• Current Assignee: Capital One Services LLC (Capital One Financial Corporation)
• Original Assignee: Capital One Financial Corporation
• Inventors: Phillips, Stephen, Chumney, Craig
• Granted Patent: US 8,346,638 B2
• Time in Patent Office: Days
• US Class Current: 705/40
• CPC Class Codes: G06Q 20/102 Bill distribution or payments
• CPC Class Codes: G06Q 20/12 specially adapted for electronic shopping systems
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions

Abstract

Systems and methods consistent with the present invention may be used as part of determining whether to chargeback a purchase transaction amount to a merchant. To this end, the system may heuristically analyze purchase transaction data to determine which transactions to analyze for chargeback processing. For instance, the system may identify purchase transactions that are likely to qualify for a chargeback. For the identified purchase transactions, the system may then determine an expected value for each transaction in terms of received revenue from chargeback processing and the costs for performing a chargeback. Using the expected values for this transaction data, the system may then prioritize which purchase transactions to review for chargeback to a respective merchant.

Claims

1. A method for managing purchase transaction data as part of determining whether to chargeback a purchase transaction, comprising:

receiving transaction data reflecting purchase transactions associated with one or more financial accounts;

determining an expected value of each purchase transaction based on charging back the respective purchase transaction to a respective merchant; and

prioritizing each purchase transaction according to the determined expected value of each purchase transaction, such that the purchase transactions may be processed for chargeback to a respective merchant in order of priority.

2. The method of claim 1, wherein determining an expected value further includes:

determining an expected value of each purchase transaction based on a probability that a payment for the respective purchase transaction may be recovered from a customer associated with the financial account.

3. The method of claim 2, wherein determining an expected value based on a payment being recovered from a customer, further includes:

determining the expected value based on the payment being recovered from the customer according to a probability that the account will be charged-off and that no payment will be collected from the customer after charging-off the account.

4. The method of claim 3, wherein determining the expected value based on the payment being recovered from the customer, further includes:

determining the expected value based on the payment being recovered from the customer according to an amount of the respective purchase transaction.

5. The method of claim 1, wherein determining an expected value further includes:

determining an expected value of each purchase transaction based on a probability that a fee may be recovered from the respective merchant as a result of charging back the transaction to the respective merchant.

6. The method of claim 5, wherein determining an expected value based on recovering a fee, further includes:

determining the expected value based on recovering the fee based on a probability that the fee will be successfully charged to the merchant.

7. The method of claim 1, wherein determining an expected value further includes:

determining an expected value of each purchase transaction based on a probability that a particular type of purchase transaction may be charged back.

8. The method of claim 1, wherein determining an expected value further includes:

determining an expected value of each purchase transaction based on costs incurred in processing a chargeback.

9. The method of claim 8, wherein the costs reflect a cost associated with interest charges that may be lost by charging back the respective purchase transaction to the respective merchant.

10. The method of claim 8, wherein the costs reflect a cost associated with notifying the customer of the chargeback.

11. The method of claim 8, wherein the costs reflect a cost associated with a user reviewing the respective purchase transaction to determine whether that purchase transaction may actually be charged back to the respective merchant.

12. The method of claim 1, further including:

distributing the expected value of each purchase transaction in a data structure, where the data structure indexes each expected value according to one or more transaction data parameters.

13. The method of claim 12, wherein the transaction data parameters include at least one of an account type, a transaction type, an amount of a respective purchase transaction, an amount of delinquency, or a collection status for any amount owed by a respective customer.

14. The method of claim 1, wherein prioritizing each purchase transaction further includes:

prioritizing only purchase transactions associated with an expected value exceeding a predetermined value.

15. The method of claim 1, wherein determining an expected value of each purchase transaction further includes:

determining an expected value for only purchase transactions exceeding a predetermined transaction amount threshold value.

16. The method of claim 1, wherein determining an expected value of each purchase transaction further includes:

determining an expected value for only purchase transactions associated with a financial account categorized as a high risk financial account.

17. The method of claim 16, wherein a categorized high risk financial account is a delinquent financial account.

18. The method of claim 16, wherein a categorized high risk financial account is a financial account having an outstanding balance due over a predetermined limit value.

25. The system of claim 3, wherein the means for determining the expected value based on the payment being recovered from the customer, further includes:

means for determining the expected value based on the payment being recovered from the customer according to an amount of the respective purchase transaction.

19. A method for managing purchase transaction data as part of determining whether to chargeback a purchase transaction, comprising:

receiving transaction data reflecting purchase transactions associated with one or more financial accounts;

filtering the received transaction data to select purchase transactions determined to have a likelihood of being charged back to a respective merchant;

determining an expected value of each filtered purchase transaction based on charging back the respective purchase transaction to a respective merchant; and

prioritizing each purchase transaction according to the determined expected value of each purchase transaction, such that the prioritized purchase transactions may be processed for chargeback to a respective merchant in order of priority.

20. The method of claim 19, wherein filtering the received transaction data further includes:

ignoring purchase transaction data associated with a transaction amount below a predetermined threshold value.

21. The method of claim 19, wherein filtering the received transaction data further includes:

ignoring purchase transaction data that is not categorized as at least one of delinquent or over limit.

22. A system for managing purchase transaction data as part of determining whether to chargeback a purchase transaction, comprising:

means for receiving transaction data reflecting purchase transactions associated with one or more financial accounts;

means for determining an expected value of each purchase transaction based on charging back the respective purchase transaction to a respective merchant; and

means for prioritizing each purchase transaction according to the determined expected value of each purchase transaction, such that the purchase transactions may be processed for chargeback to a respective merchant in order of priority.

23. The system of claim 22, wherein the means for determining an expected value further includes:

means for determining an expected value of each purchase transaction based on a probability that a payment for the respective purchase transaction may be recovered from a customer associated with the financial account.

24. The system of claim 23, wherein the means for determining an expected value based on a payment being recovered from a customer, further includes:

means for determining the expected value based on the payment being recovered from the customer according to a probability that the account will be charged-off and that no payment will be collected from the customer after charging-off the account.

26. The system of claim 22, wherein the means for determining an expected value further includes:

means for determining an expected value of each purchase transaction based on a probability that a fee may be recovered from the respective merchant as a result of charging back the transaction to the respective merchant.

27. The system of claim 26, wherein the means for determining an expected value based on recovering a fee, further includes:

means for determining the expected value based on recovering the fee based on a probability that the fee will be successfully charged to the merchant.

28. The system of claim 22, wherein the means for determining an expected value further includes:

means for determining an expected value of each purchase transaction based on a probability that a particular type of purchase transaction may be charged back.

29. The system of claim 22, wherein the means for determining an expected value further includes:

means for determining an expected value of each purchase transaction based on costs incurred in processing a chargeback.

30. The system of claim 29, wherein the costs reflect a cost associated with interest charges that may be lost by charging back the respective purchase transaction to the respective merchant.

31. The system of claim 29, wherein the costs reflect a cost associated with notifying the customer of the chargeback.

32. The system of claim 29, wherein the costs reflect a cost associated with a user reviewing the respective purchase transaction to determine whether that purchase transaction may actually be charged back to the respective merchant.

33. The system of claim 22, further including:

means for distributing the expected value of each purchase transaction in a data structure, where the data structure indexes each expected value according to one or more transaction data parameters.

34. The system of claim 33, wherein the transaction data parameters include at least one of an account type, a transaction type, an amount of a respective purchase transaction, an amount of delinquency, or a collection status for any amount owed by a respective customer.

35. The system of claim 22, wherein prioritizing each purchase transaction further includes:

prioritizing only purchase transactions associated with an expected value exceeding a predetermined value.

36. The system of claim 22, wherein the means for determining an expected value of each purchase transaction further includes:

means for determining an expected value for only purchase transactions exceeding a predetermined transaction amount threshold value.

37. The system of claim 22, wherein the means for determining an expected value of each purchase transaction further includes:

means for determining an expected value for only purchase transactions associated with a financial account categorized as a high risk financial account.

38. The system of claim 37, wherein a categorized high risk financial account is a delinquent financial account.

39. The system of claim 37, wherein a categorized high risk financial account is a financial account having an outstanding balance due over a predetermined limit value.

40. The system of claim 22, wherein the particular purchase transaction is charged back to the respective merchant via a bank used by the respective merchant.