System and Method for an Emergency Reserve During a Covered Event Using Actuarial Data

• US 20090048972A1
• Filed: 08/15/2007
• Published: 02/19/2009
• Est. Priority Date: 08/15/2007
• Status: Active Grant

• Current Assignee: Bank of America Corp.
• Original Assignee: Bank of America Corp.
• Inventors: Bierer, Jeffrey H., Myrick, Thomas, Kramer, Andrew, Mauldin, Robert M.
• Granted Patent: US 8,706,613 B2
• Time in Patent Office: Days
• US Class Current: 705/44
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/40 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 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03

Abstract

A system and method for providing emergency conditional credit to a customer of a financial institution. The system includes a customer site and a financial institution. The financial institution determines actuarial data using past history of customers incurring specified events, the actuarial data useable to predict future specified events, determines a cost for offering an emergency reserve (ER) product using the actuarial data, determines a qualification standard for the ER product, and offers the ER product to a person at the customer site. An emergency reserve protection (ERP) feature that provides protection that cancels any ER balance on a monthly basis during a covered event may also be offered to customers. One or more vendor sites may be used to handle some of the processing or managing of the ER and ERP product offerings.

Claims

1. A method for providing conditional credit comprising:

determining actuarial data using past history of customers incurring specified events, the actuarial data useable to predict future events;

determining a cost for offering an emergency reserve (ER) product using the actuarial data;

determining a qualification standard for the ER product; and

offering the ER product to people,

wherein the ER product provides a specific credit disbursement amount to a customer over a specific period of time, for at least one covered event.

2. The method according to claim 1, further comprising the customer being eligible for the credit disbursement if the customer has previously purchased the ER product, has requested the credit disbursement for an entered event, and the entered event is a said covered event.

3. The method according to claim 1, wherein the covered event comprises at least one of involuntary unemployment, disability, hospitalization, lifecycle events, moving, childbirth, or retirement.

4. The method according to claim 1, wherein the qualification standard is determined using credit score information, alternative credit scoring information employing at least one of utility data and telecommunications payments data, and proprietary customer behavioral data.

5. The method according to claim 4, wherein the credit score information comprises at least one of Fair, Isaac and Company (FICO) information, Fair, Isaac and Company'"'"'s Expansion Score or LexisNexis RiskView.

6. The method according to claim 4, wherein the qualification standard comprises credit scores lower than credit scores required for credit card qualification.

7. The method according to claim 4, wherein the qualification standard comprises at least one of no hit or ‘

thin-file’

credit scores.

8. The method according to claim 1, further comprising charging customers a periodic fee for the ER product.

9. The method according to claim 1, further comprising performing one of directly depositing the credit disbursement into an account of the requesting customer or mailing a check for the credit disbursement to the requesting customer.

10. The method according to claim 1, wherein the ER product is offered to people by one of a financial institution or a third party for the financial institution.

11. The method according to claim 1, wherein the ER product is offered to people by the third party for the financial institution, the third party further performing at least one of sending materials offering the ER product to people, processing customer applications for the ER product, approving and denying customer applications for the ER product and notifying people accordingly, receiving the requests for the credit disbursement for the entered event, verifying that the entered event is a covered event, approving and denying requests for the credit disbursement for the entered event, or sending information regarding the ER product to the customer after the processing is completed and the customer is approved.

12. The method according to claim 1, further comprising offering optional emergency reserve protection (ERP) feature to customers, the ERP feature providing protection that cancels any ER balance on a monthly basis during a covered event.

13. The method according to claim 12, further comprising charging customers a periodic fee for the ERP feature.

14. The method according to claim 12, wherein the ERP feature is offered to customers by one of a financial institution or a third party for the financial institution.

15. The method according to claim 12, wherein the ERP feature is offered to customers by the third party for the financial institution, the third party further performing at least one of sending materials offering the ERP feature to customers, processing customer applications for the ERP, or sending information regarding the ERP feature to the customer after the processing is completed.

16. The method according to claim 1, wherein the ER feature is sold only to people that meet the qualification standard.

17. The method according to claim 1, wherein the cost comprises the specific cash credit disbursement amount, the specific period of time, and a maximum credit commitment.

18. The method according to claim 17, further comprising determining if the customer that has requested the credit disbursement for the entered event has been given a previous credit disbursement.

19. The method according to claim 18, further comprising determining if a total credit disbursement made to the customer equals the maximum credit disbursement and performing one of providing the requested credit disbursement for the entered event if the maximum credit disbursement has not been paid or denying the request for the cash payment for the entered event if the maximum credit disbursement has been paid.

20. A system for providing conditional credit comprising:

a customer site, the customer site having at least one of a workstation capable of receiving and transmitting information electronically or mail handling capable of receiving and sending information by mail; and

a financial institution site, the financial institution site having a workstation capable of receiving and transmitting information electronically and mail handling capable of receiving and sending information by mail,

wherein the financial institution determines actuarial data using past history of customers incurring specified events, the actuarial data useable to predict future specified events, determines a cost for offering an emergency reserve (ER) product using the actuarial data, determines a qualification standard for the ER product, and offers the ER product to a person at the customer site.

21. The system according to claim 20, wherein the ER product provides a specific credit disbursement amount to the customer over a specific period of time, the customer being eligible for the credit disbursement if the customer has previously purchased the ER product, has requested the credit disbursement for an entered event, and the event is a covered event.

22. The system according to claim 21, further comprising a vendor site, the vendor site having at least one of a workstation capable of receiving and transmitting information electronically or mail handling capable of receiving and sending information by mail.

23. An article, the article comprising a storage medium with instructions stored therein, the instructions when executed causing a processing device to perform:

determining actuarial data using past history of customers incurring specified events, the actuarial data useable to predict future specified events;

determining a cost for offering an emergency reserve (ER) product using the actuarial data;

determining a qualification standard for the ER product; and

offering the ER product to people,

wherein the ER product provides a specific credit disbursement amount to a customer over a specific period of time, the customer being eligible for the credit disbursement if the customer has previously purchased the ER product, has requested the credit disbursement for an entered event, and the event is a covered event.

24. The article according to claim 23, wherein the covered event comprises at least one of involuntary unemployment, disability, or hospitalization.

25. The article according to claim 23, wherein the qualification standard is determined using credit score information.

26. The article according to claim 25, wherein the qualification standard comprises credit scores lower than credit scores typically required for credit card qualification, excluding sub-prime cards).

27. The article according to claim 25, wherein the qualification standard comprises at least one of no-hit or thin file credit scores.

28. The article according to claim 23, the device further performing charging customers a periodic fee for the ER product.

29. The article according to claim 23, the device further performing one of directly depositing the credit disbursement into an account of the requesting customer or mailing a check for the credit disbursement to the requesting customer.

30. The article according to claim 23, the device further performing offering optional emergency reserve protection (ERP) feature to ER customers, the ERP feature providing protection that cancels any ER balance on a monthly basis during a covered event.

31. The article according to claim 30, the device further performing charging customers a period fee for the ERP feature.

32. A system for providing conditional credit comprising:

means for determining actuarial data using past history of customers incurring specified events, the actuarial data useable to predict future specified events;

means for determining a cost for offering an emergency reserve (ER) product using the actuarial data;

means for determining a qualification standard for the ER product; and

means for offering the ER product to people,

wherein the ER product provides a specific credit disbursement amount to a customer over a specific period of time, for at least one covered event.

33. The system according to claim 32, further comprising means for charging customers a periodic fee for the ER product.

34. The system according to claim 32, further comprising means for offering an emergency reserve protection (ERP) feature to customers, the ERP feature providing protection that cancels any ER balance on a monthly basis during a covered event.

35. The system according to claim 34, further comprising means for charging customers a period fee for the ERP feature.