U.S. patent application number 10/037007 was filed with the patent office on 2002-08-29 for system and method for performing secure user account purchases.
Invention is credited to D'Agostino, John.
Application Number | 20020120587 10/037007 |
Document ID | / |
Family ID | 22870495 |
Filed Date | 2002-08-29 |
United States Patent
Application |
20020120587 |
Kind Code |
A1 |
D'Agostino, John |
August 29, 2002 |
System and method for performing secure user account purchases
Abstract
A method and system of performing secure user account purchases
in the context of a commercial transaction, such as over the
telephone, wherein the customer communicates with a custodial
authorizing entity, such as a credit card company or issuing bank
wherein such entity has previous knowledge of the account number as
well as custodial control of other account parameters such as
interest rate, payment history, available credit limit etc. The
customer supplies the custodial authorizing entity with the account
identification data such as the credit card number and may select
one or more of a possible plurality of predetermined payment
categories for the transaction, such as which define the dollar
amount for the purchase and specific, predetermined time parameters
within which authorization by the custodial authorizing entity will
remain in effect. The custodial authorizing entity then generates a
transaction code which is communicated exclusively to the customer
wherein the customer in turn communicates only the transaction
code, which is different from their account number, to the merchant
instead of a credit card number. The transaction code is indicative
of merchant identification, account identification and a designated
one of the plurality of predetermined payment categories, and is
verifiable in a conventional manner by the merchant without
providing the merchant with access to an established, continuing
account.
Inventors: |
D'Agostino, John;
(Lighthouse, FL) |
Correspondence
Address: |
MALLOY & MALLOY, P.A.
2800 S.W. Third Avenue
Historic Coral Way
Miami
FL
33129
US
|
Family ID: |
22870495 |
Appl. No.: |
10/037007 |
Filed: |
November 9, 2001 |
Related U.S. Patent Documents
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Application
Number |
Filing Date |
Patent Number |
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10037007 |
Nov 9, 2001 |
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09231745 |
Jan 15, 1999 |
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6324526 |
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Current U.S.
Class: |
705/78 |
Current CPC
Class: |
G06Q 20/105 20130101;
G06Q 20/24 20130101; G06Q 20/02 20130101; G06Q 20/0855 20130101;
G06Q 20/04 20130101; G06Q 20/385 20130101; G06Q 20/40 20130101;
G06Q 30/0241 20130101 |
Class at
Publication: |
705/78 |
International
Class: |
G06F 017/60; H04K
001/00; H04L 009/00 |
Claims
What is claimed is:
1. A method of performing secure purchases, said method comprising:
a) a customer communicating with a custodial authorizing entity
having custodial responsibility of account parameters of said
customer's pre-established account; b) said customer supplying the
custodial authorizing entity with at least account identification
data; c) said customer designating a payment category; d)
generating a transaction code that is different from said account
identification data and which is associated with said designated
payment category; e) communicating said transaction code to said
customer; f) terminating communication with said custodial
authority; g) said customer communicating said transaction code to
a merchant in connection with a purchase having defined purchase
parameters; h) said merchant communicating said transaction code to
a verifying authority; i) said verifying authority utilizing said
transaction code to verify that said defined purchase parameters
are within said designated payment category; and j) said verifying
authority communicating a purchase authorization to said merchant
if said defined purchase parameters are within said designated
payment category associated with said transaction code; and k)
completing the purchase.
2. A method as recited in claim 1 further comprising defining said
payment category as a specific maximum dollar amount, said
verifying authority communicating a purchase denial if said
purchase parameters of said purchase include a purchase dollar
amount in excess of said maximum dollar amount.
3. A method as recited in claim 1 further comprising defining said
payment category as a specific dollar amount, said verifying
authority communicating a purchase denial if said purchase
parameters of said purchase include a purchase dollar amount
different from said specific dollar amount by more than a
predetermined maximum variance.
4. A method as recited in claim 1 further comprising communicating
information associated with offered subject matter to the customer
by the merchant, pre-determining the purchase parameters of the
purchase, and corresponding said designated payment category to
said purchase parameters.
5. A method as recited in claim 1 further comprising the custodial
authorizing entity generating a transaction code which reflects at
least one of said designated payment categories from a plurality of
different types of said payment categories.
6. A method as recited in claim 5 further comprising defining at
least one of said plurality of different types of payment
categories to include amount parameters for a cost of a
purchase.
7. A method as recited in claim 5 further comprising defining at
least one of said plurality of different types of payment
categories to include time parameters during which the purchase can
be completed.
8. A method as recited in claim 5 further comprising defining at
least one of the plurality of different types of payment categories
to include authorization for a single transaction at a fixed amount
for purchase within a predetermined period of time.
9. A method as recited in claim 5 further comprising defining at
least one of the plurality of different types of payment categories
to include authorization for a single transaction at a maximum
amount for purchase within a predetermined period of time.
10. A method as recited in claim 5 further comprising defining at
least one of the plurality of different types of payment categories
to include authorization for a predetermined maximum number of
transactions up to a maximum total purchase amount.
11. A method as recited in claim 5 further comprising defining at
least one of the plurality of different types of payment categories
to include authorization for a predetermined maximum number of
transactions up to a maximum total purchase amount during a
predetermined time period.
12. A method as recited in claim 5 further comprising defining at
least one of the plurality of different types of payment categories
to include authorization for a repeating transaction at a fixed
amount.
13. A method as recited in claim 5 further comprising defining at
least one of the plurality of different types of payment categories
to include authorization for a repeating transaction at a fixed
amount payable at each of a fixed number of time intervals.
14. A method as recited in claim 5 further comprising defining the
plurality of payment categories selectable by said customer to
include at least: a) authorization for a single transaction at a
fixed amount for a purchase within a predetermined period of time,
b) authorization for a single transaction at a maximum amount for a
purchase within a predetermined period of time, c) authorization
for multiple transactions at a maximum total amount for purchases
within a predetermined time period, and d) authorization for a
repeating transaction at a fixed amount.
15. A method as recited in claim 1 further comprising defining said
payment category to include a limited time interval during which
said transaction code is valid.
16. A method as recited in claim 1 further comprising generating a
transaction code which further reflects an identification of the
merchant.
17. A method as recited in claim 1 wherein said merchant
communicates said transaction code to a verifying authority which
normally accepts and verifies credit card account information in
connection with purchases.
18. A secure purchase verification system comprising: a) a
custodial authorizing entity structured to issue a user account to
a consumer; b) said custodial authorizing entity structured to bill
said consumer for purchases consummated in connection with said
user account; c) said custodial authorizing entity responsive to a
consumer transaction request and structured to generate a
transaction code internally associated with said user account and
different from said user account; d) said transaction code
including a payment category designated by said consumer associated
therewith and structured to be presented to a merchant by said
consumer in connection with a purchase having defined purchase
parameters; e) a verifying authority structured to receive and
authorize credit card transactions from said merchant; f) said
transaction code structured to be communicated to said verifying
authority by said merchant, in connection with said purchase having
said purchase parameters, as a credit card account number utilizing
a credit card authorization system; g) said verifying authority
structured to verify that said purchase parameters of said purchase
correspond said payment category associated with said transaction
code without identifying said user account, and to accordingly
communicate an authorization or rejection to said merchant.
19. A secure purchase verification system as recited in claim 18
wherein said payment category of said transaction code includes a
defined maximum purchase amount.
20. A secure purchase verification system as recited in claim 18
wherein said payment category of said transaction code includes a
specific purchase amount.
21. A secure purchase verification system as recited in claim 18
wherein said payment category of said transaction code includes a
specific purchase amount range.
22. A secure purchase verification system as recited in claim 18
wherein said payment category of said transaction code includes a
defined time period for commencement of said purchase.
23. A secure purchase verification system as recited in claim 18
wherein said payment category of said transaction code includes a
defined plurality of purchases.
24. A secure purchase verification system as recited in claim 23
wherein said payment category of said transaction code includes a
defined maximum purchase amount for said plurality of
purchases.
25. A secure purchase verification system as recited in claim 18
wherein said payment category of said transaction code includes a
defined plurality of recurring purchases.
26. A secure purchase verification system as recited in claim 25
wherein each of said defined plurality of purchases include a
define purchase amount associated therewith.
Description
CLAIM OF PRIORITY
[0001] The present application is a continuation-in-part
application of previously filed, now pending application having
Ser. No. 09/231,745, filed on Jan. 15, 1999.
BACKGROUND OF THE INVENTION
[0002] 1. Field of the Invention
[0003] This invention relates to a system and method of performing
secure purchases using a pre-established user account, such as a
debit account, a credit account, an ATM type account, a checking
account, etc., collectively referred to herein for reasons of
clarity as credit card purchases due to the typical credit card
type account processing techniques usually employed whether the
account is a debit, savings, checking, ATM, or credit account. The
secure purchases may be made in connection with remote and local
commercial transactions, in a manner that is seamless and
verifiable to a merchant already capable of processing normal
credit card transactions, whether with or without a PIN entry, but
keeps the customers account information secure by not requiring any
disclosure whatsoever of their established account number.
Specifically, in the system of the present invention, an account
holder does not have to reveal their established account number to
a merchant or a mechanism controlled by the merchant in order to
accomplish a purchase, and does not need a specialized,
contemporaneous communicative link with a custodial authority, such
as an issuing entity, at the time of making the transaction, but
also ensures to the merchant the necessary account verifications
and approvals prior to authorizing and/or completing the
transaction in a manner that does not require a specialized
computer interface or setup beyond what is already in place to
process conventional credit card transactions. As a result, overall
security is increased by minimizing access to account numbers
without having to modify or deviate from existing, accepted account
transaction practices.
[0004] 2. Description of the Related Art
[0005] The utilization of credit based and debit based cards, such
as pure credit cards, check cashing or ATM cards, all collectively
and interchangeably referred to for purposes of clarity as credit
cards, wherein a user has a pre-established account, to conduct
transactions is ever increasing. This is especially the case with
remote or "mail-order" transactions wherein merchants desire to be
assured of a payment prior to shipping a product, as well as "in
person" transactions at stores, restaurants, etc. wherein an
individual does not have large amounts of cash. Furthermore, with
regard to remote transactions, recent years have seen a substantial
increase in the popularity of televised shopping networks to
further supplement the popularity of catalogue type sales, and the
increasing use and popularity of distributed computer networks such
as the Internet has also contributed to the dramatic increase in
the number of remote commercial transactions conducted every
day.
[0006] One primary reason associated with the rapid growth of
remote commercial transactions is the ability of a merchant to
reach an almost limitless number of potential customers at a
substantially insignificant cost and with little or no operating
overhead since an actual store is not required. Additionally, such
sales techniques permit customers to view the products and services
in a greatly expanded marketplace, representing a great number of
vendors, without extensive travel and without foregoing the privacy
and convenience of their home or other predetermined computer site
in some cases. Simply put, a telephone or like communication avenue
is all that is needed to place the consumer in contact with the
merchant and complete the transaction.
[0007] The vast increase in popularity of user account
transactions, and especially, remote commercial transactions
conducted over the telephone or internet using a credit card is
further facilitated by the relatively simple protocols and
procedures necessary to conduct and complete such transactions. In
particular, in order to complete a valid transaction, a merchant
need not even physically see the customer or the credit card, but
must merely accept and enter a customer's account number and an
expiration date thereof to obtain authorization. This same
convenience, however, is one of the primary disadvantages and/or
problems associated with conducting commerce in the manners set
forth above. Specifically, there is a great reluctance on the part
of the customer to transmit their account information because of
the proliferation of fraud, and a well recognized lack of security
directed to the protection of such account information. Indeed, it
has been established that security and privacy concerns are
realistic due to the fact that account data is easily readable or
interceptable by unauthorized parties, and can be readily used for
all types of fraudulent remote transactions with minimal risk of
being physically caught. In fact, unscrupulous individuals have
many ways of gaining access to a consumer's legitimate transaction
details and thereby obtaining the account information. Moreover, in
addition to more "high-tech" methods of intercepting or obtaining
the information, often the information can be simply obtained from
old credit card receipts or even from the unauthorized notation and
use of the information by merchants or their employees after a
legitimate transaction is made. As a result, substantial risks are
present whenever or however an account transaction is made.
Furthermore, these possible threats can be rather difficult to
prevent utilizing known methods and systems unless a consumer is
willing to completely forego the use of a credit card for
purchases.
[0008] In the case of computerized remote transactions, as
messages, including account data or other confidential information,
move across the Internet, they can easily pass through numerous
computers, any one of which can be utilized to copy such
confidential information or data, thereby leading to a further risk
of potential fraud when conducting such transactions. Presently,
some companies currently seek to address such security and privacy
concerns by the employment of encryption programs and techniques.
To this end there is an extensive facility associated with both
public and private encryption schemes being deployed in order to
guard the private or secured information being transmitted across
the internet or like world wide networks. Unfortunately, however,
even with such encryption techniques, the account information must
usually still ultimately be transmitted to a third party who did
not previously have access to that information. Even some more
sophisticated systems which seek to interpose a separate computer
or encryption entity between the consumer and the merchant so as to
obtain authorization and forward it to the merchant, that
information must still be made available to and/or transmitted to
that third party, thereby leaving open an avenue for fraud or
theft. Further, such encryption techniques, even if minimally
effective for computerized remote transactions, are not truly
useable for other conventional types of remote transactions, or
even normal in person transactions.
[0009] Based on the above, there is a need in the field of art
associated with commercial transactions for a system and method of
performing secure purchases of goods and services which truly
reduces the risk of potential fraud and theft by eliminating
outside access to a consumer's private account information without
requiring complex encryption equipment or significantly altering
the ease and convenience of current transaction techniques.
Further, such a system and method should also be effective for use
in conventional, "in person" transactions as well, thereby
providing an added measure of security and minimizing the hazards
associated with the passing on of account information by
unscrupulous merchants. Also, such a system should provide limits
to potential loss or liability in a manner which does not impede
the transaction.
[0010] It also bears noting that some systems have been developed
wherein a simultaneous link is established between a consumer, an
account issuing entity and a merchant so as to achieve more secure
account verification. Such systems, however, require a substantial
deviation and/or departure from existing account verification
techniques already used in virtually every commercial
establishment. As a result, the increase costs associated with
implementation can make such systems unpractical unless it is for
an Internet transaction wherein sophisticated computer processors
are employed. As such, it would be very beneficial to provide a
secure system that does not require merchants to alter their
established account verification techniques, but which could be
implemented and/or offered by an account issuing entity for
effective and convenient use by consumers desiring added
security.
SUMMARY OF THE INVENTION
[0011] The present invention is directed towards a system and
method of performing secure purchases using an established user
account, wherein payment for goods or services purchased is
efficiently accomplished while eliminating the necessity of
disclosure or dissemination of a consumers specific account number
or other account identification data which the customer or other
individual may wish to maintain in confidence and which may allow
extensive amounts of transactions. The system and method of the
present invention incorporates the advantage of consummating the
purchase by the customer through the pre-selection of any one of a
plurality of predetermined payment categories. Collectively, the
payment categories represent a variety of methods for accomplishing
payment for a fixed transaction, multiple transactions and/or a
repeating transaction.
[0012] One embodiment of the system and method of the present
invention comprises a customer receiving information, either as a
result of a solicitation or request, including specific data
necessary for the purchase of any given product or service. This
product information generated by the merchant can be received by
any of a plurality of conventional means including advertisements,
catalogues, computer network connections, direct person to person
customer and merchant contact, telephone solicitation, mail orders,
etc. Once the customer has identified the product or services which
he/she wishes to purchase, and/or in anticipation of a purchase,
the customer independently and directly contacts and supplies to a
custodial authorizing entity, requisite information concerning both
the identification of a specific user account, such as a credit or
debit account, and a requested payment category. Additionally,
security against unauthorized use of confidential account data may
also include information relating to the merchant's identification
and/or location.
[0013] The custodial authorizing entity is preferably defined as
the entity which has or has been assigned the custodial
responsibility for the financial account data of a customer's
established account, including a previous knowledge of the account
number and other information such as credit limits, payment
history, available credit amounts, account balances, and other
information which will determine the status of a given user account
in terms of continuously authorizing a requested payment for a
current purchase.
[0014] As part of the security system for accomplishing a
commercial transaction utilizing credit or debit payment, the
custodial authorizing entity includes sufficient facilities,
preferably including a processing computer or like applicable
hardware for the generation of an exclusive transaction code. The
transaction code is to be used in substitution for the account
number normally provide in connection with a transaction, and when
utilized as authorized, will issue the merchant a credit approval,
and will accomplish payment for the goods or services desired in
the normal fashion normally associated with a credit or debit
transaction, without the publication or dissemination of an
identifying information for a specific customer's established and
continuing account to any entity that is not already aware of that
information. In particular, the customer's established account,
which remains in effect and will continue to be used in connection
with all transactions affiliated with the custodial authorizing
entity remains protected and need not be disclosed, thus not
compromising its future use.
[0015] Further, a feature of the transaction code is its ability to
indicate any one of preferably a plurality of predetermined payment
categories which may be either requested by the customer or
automatically chosen by the custodial authorizing entity based on
the type of account or the type of purchase or other commercial
transaction involved. Each of the payment categories are reflective
of a different type of payment desired or required to consummate
the intended purchase. More specifically, the plurality of payment
categories may include a single transaction involving a specific
dollar amount for a purchase within a specific time period, such as
twenty four hours, during which authorization of the purchase
remains valid. Alternately, a single transaction may be involved
wherein a maximum limit, pre-set range, or a specific dollar amount
is determined, purchases falling outside those parameters being
invalid, and further wherein a fixed period of time is preferably
established for maintaining authorization of such purchase. Other
alternatives would involve one or more of the categories coded to
define multiple transactions involving a maximum dollar amount for
purchases, as well as a fixed period of time for authorization of
such purchases, and/or a repeating transaction wherein payments may
be automatically accessed by a merchant over a predetermined or
unspecified time interval (such as every thirty days) for a
specific dollar amount or a maximum dollar amount limit. Also,
limits solely as to a specific merchant or a given time period can
be effectively established for which the transaction code is
valid.
[0016] A further feature of the present invention to be described
in greater details hereinafter, is that the transaction code is
preferably received directly by the customer and is transmitted to
the merchant by the customer or a person specifically authorized by
the customer. Only minimal contact by the merchant and the
custodial authorizing entity is provided for purposes of the
merchant verifying the validity of the transaction code, said
contact typically being achieved utilizing conventional processes
such as those already used for the verification of a credit card
number normally offered to a merchant for the purchase of goods or
services. There is, therefore, no disclosure, publication or other
dissemination of the specific account number for a given customer
beyond those entities who already know the information, and the
transaction code is transmitted exclusively to the customer by the
custodial authorizing entity who has the ability to better identify
whether the customer is properly authorized to use the account.
Moreover, the transaction code, once given out by the customer,
only has a limited usefulness, thereby limiting the risk of misuse
and minimizing the potential losses to be experienced by the credit
card company and/or the account holder, but does not require
merchants to alter or modify their existing authorization
techniques.
[0017] These and other features and advantages of the present
invention will become more clear when the drawings as well as the
detailed description are taken into consideration.
BRIEF DESCRIPTION OF THE DRAWINGS
[0018] For a fuller understanding of the nature of the present
invention, reference should be had to the following detailed
description taken in connection with the accompanying drawings in
which:
[0019] FIG. 1 is a schematic representation of a flow chart showing
various steps involved in the performance of the system and method
of the present invention for the secure credit card purchasing;
[0020] FIG. 2 is a schematic representation similar to that of FIG.
1 wherein customer to merchant contact is accomplished by
conventional facilities such as television; and
[0021] FIG. 3 is a schematic representation similar that of FIG. 2
wherein customer to merchant contact is established either by phone
or in person.
[0022] Like reference numerals refer to like parts throughout the
several views of the drawings.
DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENT
[0023] As shown in the accompanying figures, the present invention
is directed towards a system and method for accomplishing secure
purchases utilizing an established user account, such as a
checking, credit, debit, ATM type account, collectively referred to
as a credit card type purchases. Moreover, these purchases can be
"in person", but often may include remote commercial transactions
such as mail order, purchases over the Internet, telephone
solicitations, etc. Security is establish by virtue of the
elimination of the need to disclose an active account number and
expiration date to the merchant or any other party other than the
original credit card company, issuing bank or like financial
institution which already has custodial responsibilities for the
financial or account data associated with a given customer's
account.
[0024] More specifically and with reference to FIG. 1 the system as
well as an attendant method is preferably instigated by the
customer viewing or anticipating the viewing of a product,
identifying a desired amount for a transaction and/or receiving
promotional information as at 10, either in person or by any of the
electronic or more conventional techniques which will be described
in greater detail with reference to FIGS. 2 through 3. Once the
customer reviews the product or promotional information and/or has
what they determine to be sufficient information, such as including
price, product or service identification, payment requirement,
etc., regarding the remote commercial transaction to be conducted,
the customer contacts, either by computer, telephone or in person,
a custodial authorizing entity as at 12. The custodial authorizing
entity may herein be defined as comprising that entity or
institution which has or has been designated by the entity which
has custodial responsibility for the financial data and security of
a given account of a customer. As set forth above such custodial
authorizing entity can be represented by the credit card company
issuing a credit card to a given customer or alternately can be
represented by a bank or other financial institution serving to
sponsor a credit card or debit card to the extent of processing the
debits and credit associated therewith. The authorizing entity's
custodial responsibilities of course includes the previous
knowledge and/or storage of the account number, such as the credit
card number, serving to identify a specific customer's account.
Once contacted, the customer then supplies appropriate
identification data to inform the custodial authorizing entity of a
specific customer's account as at 14. In addition, the customer
will supply the custodial authorizing entity with additional
required information needed to consummate the purchase as well as
ensure the security of the account in order to prevent its
unauthorized use. Such additional information may also include the
identification of the merchant or merchants involved, when such
information is deemed necessary, and the selection and definition
of a requested one of a plurality of predetermined payment
categories to facilitate consummation of the purchase of the
products or services desired. Such predetermined plurality of
payment categories will be discussed in greater detail
hereinafter.
[0025] Once the appropriate information has been received from the
customer as indicated at 16, the custodial authorizing entity
verifies the credit card status and account identification of the
customer to determine the viability of the account in terms of
dollar amount limits, payment history, available credit balance,
etc. If the accessed credit card account is not in good standing,
the custodial authorizing entity will permanently or temporarily
terminate the transaction as at 18 and/or communicate to the
customer directly as at 18' by any applicable means for purposes of
informing the customer of the unacceptable status of the accessed
credit card account. If the account is in good standing, based at
least in part on the requested payment category, (such as amount of
payment), the custodial authorizing entity generates a transaction
code as at 20. The transaction code is preferably a temporary or
disposable code that is used in substitution for the specific
account number which would normally identify a customer's account
to a merchant and would allow at least some access to charges
thereon by any entity having possession of the account number
whether or not such possession was authorized or unauthorized. More
specifically, the transaction code is pre-coded to be indicative of
a specific account, possibly a merchant or merchants identification
and/or another designated payment category, preferably selected
from a plurality of predetermined payment categories. Once
generated, the transaction code is communicated exclusively to the
authorized and verified customer by the custodial authorizing
entity as at 22, wherein the system and method of the present
invention preferably restricts communication between the custodial
authorizing entity and the merchant except to conduct a normal
verification as will be explained. In this regard, it is noted that
the transaction code may be audibly communicated to the user,
and/or may be printed on a single or infrequent use paper or card.
Furthermore, pre-printed cards bearing transaction codes may be
provided to a customer, the contact with the custodial entity
activating the transaction code and specifying its characteristics.
As a result, even if lost or stolen, a pre-printed transaction code
has no use or value unless activated, and then only within the
defined payment category parameters.
[0026] The verified customer thereafter and preferably within a
time limit to be determined by the customer in connection with the
payment category and pre-coded in association with the transaction
code, will directly or through an authorized representative
communicate the transaction code to the merchant as at 24. The
system and method of the preferred embodiment of the present
invention contemplates that only the verified customer will
transmit the generated transaction code to the merchant in the case
of a remote commercial transaction, thereby limiting knowledge of
the transaction code to those parties having a need to know. Of
course, however, as the transaction code will generally have a
limited value as defied by the verified customer when obtained, the
verified customer may designate an agent or other entity to act as
the customer on his/her behalf, with the amount of potential
liability to be experienced by such a transaction to be limited to
the amount defined by the verified customer when obtaining the
transaction code and/or to certain types of transactions.
[0027] At this point the purchase is consummated at least from the
customer standpoint in that the customer has previously established
the acceptable status of the account. Therefore the customer feels
free to disclose the transaction code to the merchant or merchants
instead of the actual account number as at 22, 24 and is relatively
unconcerned if the transaction code is published or otherwise
disseminated to unauthorized entities after use. In a preferred
embodiment wherein a merchant identifier is pre-coded in
association with the transaction code, the pre-coding of the
transaction code will prohibit an unauthorized use due at least in
part to the fact that the merchant is specifically identified and
any attempt to use the transaction code other than by the
identified merchant will be prohibited. In addition, the merchant
is prevented from "overcharging" or "extending" the purchase by
fixing the dollar amount to satisfy the specific cost or limit of
the purchase as well as a specific time limit or time parameters in
which the authorization for payment is valid. Such information, as
set forth above, is communicated by the requested and subsequently
designated payment category as set forth above. Restricted
communication between the merchant and the custodial authorizing
entity as at 26 is permitted exclusively for purposes of
verification of the transaction code in a manner, which may
preferably utilize, at least to some extent, conventional
facilities for the verification of a credit card number by most
merchants or like commercial establishments. As a result, the
merchant has appropriate verification as to the validity of a
transaction and can effectively make arrangements to be paid by the
account provider in the normal course of business, without
requiring additional specialized facilities beyond what they
already have in order to accept these types of transactions.
[0028] If for some reason the transaction code is refused
verification, the customer may be informed directly by the merchant
as at 28 and/or the transaction may be terminated as at 30 as would
be the case with a refused credit card. Assuming verification of
the transaction code by the custodial authorizing entity, however,
the merchant proceeds to consummate the purchase and send the
order, as at 32, in the case of a remote commercial
transaction.
[0029] FIGS. 3 and 4 are representative of the versatility of the
system and method of the present invention wherein the customer 54
may receive the aforementioned promotional information from the
merchant 56 by any appropriate means such as television
solicitation as at 58, phone solicitation as at 60 and/or personal
solicitation as at 62. Once the customer receives the promotional
information, which may include the viewing of the product itself,
or in advance if a general estimate as to the ultimate cost of an
anticipated purchase(s) can be made prior to viewing promotional
information, the customer contacts the custodial authorizing entity
64 by any appropriate electronic or conventional facilities such as
direct phone to phone contact as at 66 and 66' or direct computer
contact as at 42', 45'. Once the customer's authorization is
confirmed, details of the anticipated transaction are established
so as to determine a payment category, and the a transaction code
is issued to the customer. The customer, either directly or through
a representative, can then utilize the transaction code to
consummate a transaction within the defined parameters of the
payment category. Moreover, the merchant 56, through a
conventional, yet restricted communication with the custodial
authorizing entity 64 by any of a plurality of conventional or
electronic methods using computer to computer linking as at 44',
45' or by telephone transmission as at 56', 66', can obtain a
verification and subsequent payment utilizing the transaction code
only.
[0030] As emphasized above, an important feature of the present
invention is the ability of the customer to request a desired or a
required payment category and the ability of the custodial
authorizing entity 64 and/or a processing computer 45 of the
custodial authorizing entity to issue a transaction code in
accordance with the payment category. The payment categories, may
be collectively defined as a variety of different types of
transactions. Such transactions may include a single transaction
for a specific amount of a purchase to be consummated.
Alternatively, the payment category may include a single
transaction defined by a single purchase having a maximum limit or
range limit amount, wherein the specific or precise cost of the
purchase has not been determined for a variety of reasons, and as
such, the customer desires to set a maximum amount or a range for
which the single transaction may be made. Accordingly, with such a
payment category, the exact amount may not be known in advance, but
the customer is assured of not paying over the specifically
designated maximum limit. In addition, the transactions are
preferably, but not necessarily, authorized to be conducted only
over a fixed period of time, such as within twenty four hours,
thereby ensuring that an outstanding transaction code does not
remain valid if not used as generally intended. This limited time
period can, of course be varied or omitted depending upon the
wishes of the customer and/or the policies of the custodial
authorizing entity. Also, these or any other payment category
transactions may include a specific merchant identification to
further restrict use of the transaction code.
[0031] The payment category may also include a multi-transaction
authorization wherein more than one purchase may be made from one
or a plurality of different merchants, each of which may or may not
be identified by the customer and pre-coded in association with the
transaction code, and wherein a total cost of the plurality of
purchases may not exceed a maximum limit amount. This transaction
can also be limited to having to take place within a predetermined,
designated fixed life span, such as but not limited to twenty four
hours. Accordingly, in some instances wherein a customer, or an
agent of the customer, such as a child, guardian, or care giver,
must make a number of transactions or purchases which are
authorized by the customer, the customer may designate a maximum
amount which can be spent utilizing a particular transaction code
within a predetermined period of time, and/or can designate that
only one merchant, whether designated or not, can use the
transaction code, and/or may designate that a plurality of
transactions can be made so long as each is below a predetermined
amount or to a predetermined merchant.
[0032] As yet another alternative, the payment category may include
a repeating transaction for a specific amount to be paid in each of
a fixed number of intervals. For example, the customer may which to
join a gym or receive services or products over a fixed number of
payment intervals, such as every thirty days. Accordingly, the
merchant will be authorized to charge the account designated by the
corresponding transaction code a fixed monthly payment. Similarly,
a repeating transaction for a stated minimum interval such as every
thirty days may be authorized for a specific amount for an
unspecified number of intervals wherein the merchant will be
authorized to continuously obtain payment on a "monthly" basis
until the customer decides to cancel such authorization.
[0033] Since many modifications, variations and changes in detail
can be made to the described preferred embodiment of the invention,
it is intended that all matters in the foregoing description and
shown in the accompanying drawings be interpreted as illustrative
and not in a limiting sense. Thus, the scope of the invention
should be determined by the appended claims and their legal
equivalents.
[0034] Now that the invention has been described,
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