U.S. patent application number 15/593008 was filed with the patent office on 2017-11-16 for communication network and method for processing pre-chargeback disputes.
The applicant listed for this patent is MasterCard International Incorporated. Invention is credited to John D. Chisholm, Bradford R. Dillahunty, Michelle L. Hafner, Brenda Renee Hopkins, John Larko.
Application Number | 20170330196 15/593008 |
Document ID | / |
Family ID | 58745449 |
Filed Date | 2017-11-16 |
United States Patent
Application |
20170330196 |
Kind Code |
A1 |
Larko; John ; et
al. |
November 16, 2017 |
COMMUNICATION NETWORK AND METHOD FOR PROCESSING PRE-CHARGEBACK
DISPUTES
Abstract
A pre-chargeback computer network for processing pre-chargeback
dispute messages includes a dispute analyzer (DA) computing device.
The DA computing device is configured to receive a dispute message
identifying a disputed transaction from an issuer portal over a
first communication link, the dispute message including transaction
data associated with the disputed transaction and dispute data. The
DA computing device is further configured to analyze the
transaction data and the dispute data, and route the dispute
message over the pre-chargeback network or a separate chargeback
network based on the analysis.
Inventors: |
Larko; John; (Wildwood,
MO) ; Hafner; Michelle L.; (Chesterfield, MO)
; Dillahunty; Bradford R.; (Chesterfield, MO) ;
Hopkins; Brenda Renee; (Wildwood, MO) ; Chisholm;
John D.; (Ballwin, MO) |
|
Applicant: |
Name |
City |
State |
Country |
Type |
MasterCard International Incorporated |
Purchase |
NY |
US |
|
|
Family ID: |
58745449 |
Appl. No.: |
15/593008 |
Filed: |
May 11, 2017 |
Related U.S. Patent Documents
|
|
|
|
|
|
Application
Number |
Filing Date |
Patent Number |
|
|
62335369 |
May 12, 2016 |
|
|
|
Current U.S.
Class: |
1/1 |
Current CPC
Class: |
G06Q 20/34 20130101;
G06Q 30/016 20130101; G06Q 20/407 20130101; G06Q 30/06 20130101;
H04L 67/10 20130101; G06Q 20/24 20130101 |
International
Class: |
G06Q 30/00 20120101
G06Q030/00; H04L 29/08 20060101 H04L029/08 |
Claims
1. A pre-chargeback computer network for processing pre-chargeback
dispute messages, said network comprising: a dispute analyzer (DA)
computing device in communication with a memory; an issuer portal;
and a first communication link connecting the issuer portal to the
DA computing device, wherein the DA computing device is configured
to: receive a dispute message identifying a disputed transaction
from the issuer portal over the first communication link, the
dispute message including transaction data associated with the
disputed transaction and dispute data; analyze the transaction data
and the dispute data; and route the dispute message over the
pre-chargeback computer network or a separate chargeback network
based on the analysis.
2. The pre-chargeback computer network of claim 1 further
comprising: a merchant portal; and a second communication link
connecting the merchant portal to the DA computing device, wherein
the DA computing device is further configured to: determine that
the disputed transaction qualifies as a pre-chargeback dispute
based on the analysis; and route the dispute message as a
pre-chargeback dispute message to the merchant portal over the
second communication link.
3. The pre-chargeback computer network of claim 2, wherein the DA
computing device is further configured to: analyze the dispute data
to determine a merchant involved in the disputed transaction to
receive the pre-chargeback dispute message; and route the
pre-chargeback dispute message to the merchant portal associated
with the merchant.
4. The pre-chargeback computer network of claim 2, wherein the
merchant portal is configured to display one or more pre-chargeback
dispute messages associated with pre-chargeback disputes and accept
text entered by the merchant in response to the one or more
pre-chargeback dispute messages.
5. The pre-chargeback computer network of claim 2, wherein the DA
computing device is further configured to: receive a pre-chargeback
response message over the second communication link from the
merchant portal, wherein the pre-chargeback response message was
prepared by the merchant; and route the pre-chargeback response
message over the first communication link to the issuer portal,
wherein the pre-chargeback response message is accessible by a
cardholder.
6. The pre-chargeback computer network of claim 1 further
comprising: a payment processor; and a third communication link
connecting the DA computing device to the payment processor,
wherein the DA computing device is further configured to: determine
that the disputed transaction qualifies as a chargeback dispute
based on the analysis; and route the dispute message as a
chargeback dispute message to the payment processor over the third
communication link.
7. The pre-chargeback computer network of claim 1, wherein the
dispute data includes at least one of (i) a narrative prepared by a
cardholder relating to the disputed transaction or (ii) one or more
multiple choice options selected by the cardholder relating to the
disputed transaction.
8. The pre-chargeback computer network of claim 1, wherein the DA
computing device is further configured to determine whether the
disputed transaction is a chargeback or a pre-chargeback using at
least one of natural language processing, statistical analysis, and
machine learning analysis.
9. A computer-implemented method for processing pre-chargeback
dispute messages over a pre-chargeback network, said method
implemented using a dispute analyzer (DA) computing device, said
method comprising: receiving, by the DA computing device, a dispute
message identifying a disputed transaction from an issuer portal
over a first communication link, the dispute message including
transaction data associated with the disputed transaction and
dispute data; analyzing, by the DA computing device, the
transaction data and the dispute data; and routing, by the DA
computing device, the dispute message over the pre-chargeback
network or a separate chargeback network based on the analysis.
10. The computer-implemented method of claim 9 further comprising:
determining, by the DA computing device, that the disputed
transaction qualifies as a pre-chargeback dispute based on the
analysis; and routing, by the DA computing device, the dispute
message as a pre-chargeback dispute message to a merchant portal
over a second communication link.
11. The computer-implemented method of claim 10 further comprising:
analyzing, by the DA computing device, the dispute data to
determine a merchant involved in the disputed transaction to
receive the pre-chargeback dispute message; and routing, by the DA
computing device, the pre-chargeback dispute message to the
merchant portal associated with the merchant.
12. The computer-implemented method of claim 10 further comprising:
receiving, by the DA computing device, a pre-chargeback response
message over the second communication link, wherein the
pre-chargeback response message was prepared by a merchant involved
in the disputed transaction; and routing, by the DA computing
device, the pre-chargeback response message over the first
communication link to the issuer portal, wherein the pre-chargeback
response message is accessible by a cardholder.
13. The computer-implemented method of claim 9 further comprising:
determining, by the DA computing device, that the disputed
transaction qualifies as a chargeback dispute based on the
analysis; and routing, by the DA computing device, the dispute
message as a chargeback dispute message to a payment processor over
a third communication link.
14. The computer-implemented method of claim 9 further comprising
designating, by the DA computing device, the disputed transaction
as a chargeback or a pre-chargeback using at least one of natural
language processing, statistical methods, and machine learning
analysis methods.
15. A non-transitory computer-readable medium that includes
computer-executable instructions for processing pre-chargeback
dispute messages over a pre-chargeback network, wherein when
executed by a dispute analyzer (DA) computing device comprising at
least one processor in communication with at least one memory
device, the computer-executable instructions cause the DA computing
device to: receive a dispute message identifying a disputed
transaction from an issuer portal over a first communication link,
the dispute message including transaction data associated with the
disputed transaction and dispute data; analyze the transaction data
and the dispute data; and route the dispute message over the
pre-chargeback network or a separate chargeback network based on
the analysis.
16. The non-transitory computer readable medium of claim 15,
wherein the computer-executable instructions further cause the DA
computing device to: determine that the disputed transaction
qualifies as a pre-chargeback dispute based on the analysis; and
route the dispute message as a pre-chargeback dispute message to a
merchant portal over a second communication link.
17. The non-transitory computer readable medium of claim 16,
wherein the computer-executable instructions further cause the DA
computing device to: analyze the dispute data to determine a
merchant involved in the disputed transaction to receive the
pre-chargeback dispute message; and route the pre-chargeback
dispute message to the merchant portal associated with the
merchant.
18. The non-transitory computer readable medium of claim 16,
wherein the computer-executable instructions further cause the DA
computing device to: receive a pre-chargeback response message over
the second communication link, wherein the pre-chargeback response
message was prepared by the merchant; and route the pre-chargeback
response message over the first communication link to the issuer
portal, wherein the pre-chargeback response message is accessible
by a cardholder.
19. The non-transitory computer readable medium of claim 15,
wherein the computer-executable instructions further cause the DA
computing device to: determine that the disputed transaction
qualifies as a chargeback dispute based on the analysis; and route
the dispute message as a chargeback dispute message to a payment
processor over a third communication link.
20. The non-transitory computer readable medium of claim 15,
wherein the computer-executable instructions further cause the DA
computing device to determine whether the disputed transaction is a
chargeback or a pre-chargeback using at least one of natural
language processing, statistical analysis, and machine learning
analysis.
Description
CROSS REFERENCE TO RELATED APPLICATION
[0001] This application claims the benefit of U.S. Provisional
Patent Application No. 62/335,369, filed on May 12, 2016, the
contents of which are hereby incorporated herein by reference for
all purposes.
BACKGROUND
[0002] The present application relates generally to communication
networks and, more particularly, to a network-based system and
method for uniquely linking parties via a communication network to
resolve pre-chargeback disputes.
[0003] When a cardholder uses a payment card (e.g., a credit card
or a debit card) to initiate a transaction to purchase goods or
services from a merchant, an acquiring bank (i.e., the merchant's
bank) will typically reimburse the merchant for the transaction.
The acquiring bank will then settle those funds with an issuing
bank of the account corresponding to the payment card by presenting
transaction data, associated with the transaction, to a payment
processor. In a process known as clearing, transaction data is
communicated from the acquiring bank through the payment processor
to the issuing bank. After clearing, settlement of the final
payment occurs via the payment processor. Settlement is a process
used to exchange funds between the acquiring bank and the issuing
bank for the net value of a batch of all monetary transactions that
have cleared for that processing day.
[0004] On occasion, the cardholder may be unsatisfied with the
goods or services provided by the merchant, may not recognize the
purchase, may determine the purchase is fraudulent, or may
otherwise dispute the transaction. In these examples, the user may
initiate a transaction dispute, known as a chargeback, with the
issuing bank. The chargeback may be used to return some or all of
the funds associated with the disputed transaction to the account
corresponding to the payment card. Theses chargeback disputes are
also processed over the payment network. Typically, the issuing
bank immediately issues a credit to the account for the amount of
the transaction. The issuing bank then sends a chargeback request
to an issuing bank processor, and the request is collected with
other requests and submitted in a batch to the payment processor.
The chargeback request is then sent to the acquiring bank or an
acquirer processor. However, the merchant may dispute the
chargeback with the assistance of the acquiring bank. The issuing
bank and the acquiring bank may then attempt to mediate the charge
through an arbitration proceeding. Depending on the outcome, the
cardholder, the issuing bank, the acquiring bank, or the merchant
may be left with the cost of the transaction.
[0005] The chargeback process is complicated, time consuming,
and/or costly to all participants involved. Each chargeback
transmitted through the payment processor and over the payment
network consumes network resources and bandwidth.
[0006] However, some transaction disputes could be resolved between
the cardholder and the merchant without a chargeback request.
Unfortunately, a system that allows cardholders to communicate
directly with a merchant regarding questionable transactions does
not exist. Rather, the cardholder is only given the option of
submitting a chargeback. Accordingly, it is desirable to have a
system that allows a cardholder to submit a dispute, the system
including a communication network linking a cardholder with a
merchant to resolve at least some disputes without having to use
payment processor resources.
BRIEF DESCRIPTION
[0007] In one aspect, a pre-chargeback computer network for
processing pre-chargeback dispute messages is provided. The
pre-chargeback computer network includes a dispute analyzer (DA)
computing device in communication with a memory, an issuer portal,
and a first communication link connecting the issuer portal to the
DA computing device. The DA computing device is configured to
receive a dispute message identifying a disputed transaction from
the issuer portal over the first communication link, the dispute
message including transaction data associated with the disputed
transaction and dispute data. The DA computing device is further
configured to analyze the transaction data and the dispute data,
and route the dispute message over the pre-chargeback network or a
separate chargeback network based on the analysis.
[0008] In another aspect, a computer-implemented method for
processing pre-chargeback dispute messages over a pre-chargeback
network is provided. The method is implemented using a dispute
analyzer (DA) computing device. The method includes receiving, by
the DA computing device, a dispute message identifying a disputed
transaction from an issuer portal over a first communication link,
the dispute message including transaction data associated with the
disputed transaction and dispute data. The method also includes
analyzing, by the DA computing device, the transaction data and the
dispute data, and routing, by the DA computing device, the dispute
message over the pre-chargeback network or a separate chargeback
network based on the analysis.
[0009] In yet another aspect, a non-transitory computer readable
medium that includes computer executable instructions for
processing pre-chargeback dispute messages over a pre-chargeback
network is provided. When executed by a dispute analyzer (DA)
computing device including at least one processor in communication
with at least one memory device, the computer executable
instructions cause the DA computing device to receive a dispute
message identifying a disputed transaction from an issuer portal
over a first communication link, the dispute message including
transaction data associated with the disputed transaction and
dispute data. The computer executable instructions further cause
the DA computing device to analyze the transaction data and the
dispute data, and route the dispute message over the pre-chargeback
network or a separate chargeback network based on the analysis.
BRIEF DESCRIPTION OF THE DRAWINGS
[0010] FIGS. 1-6 show example embodiments of the methods and
systems described herein.
[0011] FIG. 1 is a schematic diagram illustrating an exemplary
multi-party payment network system for processing payment card
transactions.
[0012] FIG. 2 is a schematic diagram illustrating an exemplary
multi-party network system for processing payment card
chargebacks.
[0013] FIG. 3 is a schematic diagram illustrating an exemplary
computer system that includes a dispute analyzer (DA) computing
device for designating transaction disputes as either chargeback
disputes or pre-chargeback disputes.
[0014] FIG. 4 is a data flow diagram illustrating an example method
of a pre-chargeback dispute resolution using the DA computing
device, as shown in FIG. 3.
[0015] FIG. 5 is a schematic diagram of an example server computing
device that maybe used with the computer system shown in FIG.
3.
[0016] FIG. 6 is flowchart of an example process for designating a
transaction dispute as either a chargeback dispute or
pre-chargeback dispute.
DETAILED DESCRIPTION
[0017] Described herein is a transaction dispute communication
system linking cardholders with merchants for resolving transaction
disputes between said parties. This "pre-chargeback system" enables
resolution of transaction disputes before or without submitting the
transaction disputes over a payment network as chargebacks.
Therefore, the pre-chargeback system reduces traffic processed by
the payment network by providing a network communication link
between said parties for addressing these pre-chargebacks.
[0018] The pre-chargeback system enables resolution of transaction
disputes between cardholders, issuers (e.g., issuing banks), and
merchants, to avoid submitting chargebacks to the payment network.
The pre-chargeback system includes at least a transaction dispute
analyzer (DA) computing device, an issuer portal, a merchant
portal, and a pre-chargeback network including one or more
communication channels or links. The DA computing device includes
at least one processor in communication with a memory. The DA
computing device is in communication with the issuer portal and the
merchant portal and is configured to exchange one or more messages
between these portals, or a cardholder and a merchant, to
facilitate resolving a transaction dispute. A "pre-chargeback," as
used herein, is defined as a dispute or question raised by the
cardholder with respect to a payment transaction. For example, a
cardholder may identify an incorrect transaction amount, or may not
recognize the merchant based on the payment transaction data. Such
a dispute may be resolved by the merchant without having to submit
the dispute in question through the chargeback process. In some
cases, if a pre-chargeback cannot be resolved through the
pre-chargeback system, the pre-chargeback may then be submitted as
a chargeback through the payment network.
[0019] The issuer portal is communicatively coupled to the DA
computing device over a first network connection. The merchant
portal is communicatively coupled to the DA computing device over a
second network connection. The first and/or second network
connection may include, for example, a local area network (LAN) or
a wide area network (WAN), dial-in-connections, cable modems, and
special high-speed Integrated Services Digital Network (ISDN)
lines. In some embodiments, the issuer portal and/or the merchant
portal may be communicatively coupled to a payment processor. In
one embodiment, the DA computing device is in communication with or
is a part of the payment processor. In another embodiment, the DA
computing device is integrated with the issuer server. In some
embodiments, the DA computing device functions as a router and
provides a number of network interfaces. Each network interface may
be associated with IP address information (e.g., interface IP
address and subnet) to enable the exchange of data. Routers are
well known to those of ordinary skill in the art and will not be
further described except as to how they relate to embodiments of
the disclosure.
[0020] In one example embodiment, a cardholder, using an
internet-enabled user computing device (such as a mobile phone,
smartphone, personal digital assistants (PDA), desktop computer, or
laptop computer) accesses a controlled-access issuer portal
associated with an issuing bank. The issuer portal may be a
website/webpage, a series of websites/webpages, a web application,
or a mobile application connected to an issuer server. The
cardholder accesses the issuer portal to view an online banking
account associated with a payment card issued by the issuing bank
and assigned to the cardholder. The payment card is used to
initiate a payment for goods or services to a merchant. The
cardholder may be required to enter information such as login
information into the issuer portal to interact with the issuer
portal and view the online banking account. The online banking
account may include a transaction history associated with the
payment card.
[0021] The cardholder uses the issuer portal to review the
transaction history associated with the payment card. The issuer
portal further includes one or more features enabling the
cardholder to dispute a transaction listed in the transaction
history. For example, the cardholder can select a transaction to
dispute. This dispute will either be processed through the
pre-chargeback network as a pre-chargeback or through the payment
network as a chargeback. The issuer portal may provide one or more
features within a user interface that enable the cardholder to
select a transaction to dispute, such as a button or checkbox. The
issuer portal may additionally provide one or more features that
enable the cardholder to indicate a reason for the dispute, such as
a drop-down menu, a multiple-choice list, and/or a text entry
field. The cardholder may, for example, dispute the transaction
because the cardholder is unsatisfied with goods or services
provided by the merchant, the cardholder does not recognize a
purchase, the cardholder believes that a transaction amount is
wrong, and/or the cardholder determines a purchase is fraudulent.
Information associated with the selected transaction for dispute,
including the cardholder-provided data regarding the reason(s) for
the dispute, is referred to herein as "cardholder dispute
data".
[0022] The issuer portal may further include one or more messaging
sections to receive and display messages to the cardholder. For
example, the messages may be in the form of electronic messages
(e.g., e-mails or instant messages) from one or more merchants
and/or the issuer. The cardholder is able to view and respond to
the messages within the one or more messaging sections.
[0023] After selecting a transaction to dispute from the issuer
portal and providing the cardholder dispute data, the cardholder
uses the issuer portal to submit the dispute (e.g., by selecting a
"submit" option). The issuer portal retrieves transaction data
associated with the disputed transaction and generates a dispute
message including the transaction data and the cardholder dispute
data. The associated transaction data includes, but is not limited
to, a primary account number (PAN) associated with a payment card
used to initiate the transaction, account profile data for the PAN,
a merchant identifier (ID), an acquiring bank identifier, an
issuing bank ID, an original transaction amount, a transaction date
and time, a merchant location ID, a card product type, a merchant
category code, an authorization code, and/or other transaction
identifiers that may be used to identify the merchant and/or the
disputed transaction. The issuer portal may generate a dispute
identifier associated with the dispute and include the dispute ID
within the dispute message. The issuer portal may further generate
a reason code associated with the cardholder provided reason for
the dispute, wherein the reason code is a particularly formatted
data element configured to easily communicate the reason for the
dispute the merchant. The dispute message is transmitted by the
issuer server to the DA computing device.
[0024] The DA computing device receives the dispute message. In the
example embodiment, the DA computing device is configured to
analyze the dispute message and determine whether to transmit the
dispute message through the payment network (e.g., to the payment
processor) for the normal chargeback process or through the
pre-chargeback network for potential resolution. In some
embodiments, the issuer portal and/or a cardholder statement
indicate that a pre-chargeback is in pending status and under
review.
[0025] The DA computing device may use natural language processing,
and/or statistical methods, and/or other machine learning methods
to analyze the dispute data to determine where to route the dispute
message. For example, in one embodiment, the DA computing device
may identify particular data ("indicators") that are historically
associated with disputed transactions that have been resolved by
pre-chargeback network communication between a merchant and a
cardholder. For example, cardholders that dispute transactions
because they don't recognize the merchant associated with the
transaction may include the phrase "don't recognize" in the
cardholder dispute data. If such disputes are often resolved by
pre-chargeback network communication between the merchant and the
cardholder, the DA computing device may learn to associate the
phrase "don't recognize" with a high probability of pre-chargeback
resolution and route applicable dispute messages through the
pre-chargeback network for potential resolution. These indicators
may be stored in a database associated with the DA computing
device. In some embodiments, the DA computing device also uses
keywords or indicators from the dispute message to determine how to
route the dispute message.
[0026] In another embodiment, the issuer portal enables the
cardholder to choose whether to submit the transaction dispute
directly through the normal chargeback process or to the merchant
via the pre-chargeback system for transaction dispute resolution.
In such an embodiment, the issuer imbeds an indicator of the
cardholder submission selection into the dispute message as part of
the cardholder dispute data, and the DA computing device identifies
the indicator of the cardholder selection upon processing the
cardholder dispute data embedded within the dispute message. If the
cardholder chooses to submit the dispute directly through the
normal chargeback process, the DA computing device transmits the
dispute message to the payment processor as a chargeback message.
In an alternative embodiment, the issuer portal is in direct
communication with the payment processor and transmits the dispute
message as a chargeback message directly to the payment processor
without using the DA computing device. Alternatively, if the
cardholder chooses to submit the dispute to the merchant as a
pre-chargeback, the issuer portal transmits the dispute message to
the DA computing device. The DA computing device then transmits the
dispute message to the merchant portal associated with the merchant
identified in the dispute message as a pre-chargeback message. The
merchant accesses the merchant portal to access and respond to the
pre-chargeback message, as described below.
[0027] In still another embodiment, the issuer server itself
determines whether to enable the cardholder to communicate directly
with the merchant using the pre-chargeback network. For example,
the issuer portal may include a pop-up browser enabling the
cardholder to transmit the dispute message to the DA computing
device for pre-chargeback resolution.
[0028] Upon receiving a dispute message and determining the dispute
message is to be routed through the pre-chargeback network as a
pre-chargeback message, the DA computing device transmits the
pre-chargeback message to a merchant server. In one embodiment, the
DA computing device is configured to use the dispute message,
particularly the associated transaction data, to determine the
merchant associated with the pre-chargeback message. In some
embodiments, each merchant has a separate merchant portal. In such
embodiments, the DA computing device determines the particular
merchant server that provides the merchant portal for the
identified merchant. The DA computing device transmits the
pre-chargeback message to that merchant server. In an alternative
embodiment, all merchants share a merchant portal but each merchant
has a separate messaging section to display, receive, and transmit
message communications. In such embodiments, the DA computing
device transmits the pre-chargeback message to a central merchant
server that provides a merchant portal.
[0029] The merchant portal displays the pre-chargeback message,
including at least some of the cardholder dispute data, enabling
the merchant to review new pre-chargebacks and updates to existing
pre-chargebacks. The merchant portal can be a website/webpage, a
series of websites/webpages, a web application, or a mobile
application. The merchant portal further includes one or more
messaging sections to display one or more received messages (such
as text message communications, electronic mail (i.e., emails),
and/or other information) relating to one or more pre-chargebacks.
The merchant then reviews the pre-chargeback messages and provides
a pre-chargeback response message. The response may include, for
example, querying the cardholder for additional detail and/or
providing store credit with the merchant to the cardholder.
[0030] In some embodiments, the merchant portal is part of and/or
is hosted by the DA computing device and accessible to merchants.
In alternative embodiments, a separate computing device (e.g., a
merchant portal) hosts the merchant portal(s).
[0031] The merchant can also respond to the cardholder by using the
one or more messaging sections to create and transmit a
pre-chargeback response message through the pre-chargeback network
(e.g., the second communication link) to the DA computing device.
The DA computing device is configured to then transmit the
pre-chargeback response message to the issuer portal. In some
embodiments, the cardholder is notified of the pre-chargeback
response message. For example, a visual queue appears in the issuer
portal or on a cardholder statement. In some embodiments, the
cardholder is notified of the pre-chargeback response message via
their preferred method of contact provided by the cardholder to the
issuer (e.g., mobile phone prompt/text message, email, telephone
call, etc.).
[0032] The cardholder may use the issuer portal to respond to the
pre-chargeback response message to continue the pre-chargeback
resolution process. The cardholder may agree to a resolution
proposed by the merchant in the pre-chargeback response message.
Alternatively, the cardholder and the merchant can continue to
exchange messages using the above-described process.
[0033] In some embodiments, the merchant may choose to respond to
the pre-chargeback message by submitting the dispute to the payment
network for processing through the normal chargeback process. For
example, the merchant may receive the pre-chargeback message and
decide that the pre-chargeback is more appropriate for the
chargeback process. In one embodiment, the merchant notifies the DA
computing device to submit the pre-chargeback to the payment
processor. In another embodiment, the merchant is in direct
communication with the payment processor or in direct communication
with the acquirer and can begin the chargeback process without the
DA computing device.
[0034] The technical effects achieved by the systems and methods
described herein include providing a new communication network (a
"pre-chargeback network") between consumers (e.g., cardholders and
issuing banks) and merchants for resolving transaction disputes
between the parties prior to or without submitting the disputed
transactions as chargebacks through the payment processor. The
pre-chargeback system described herein enables consumers and
merchants to more easily resolve these disputes by enabling the
parties to communicate directly, submit questions, ask for more
information, etc. The pre-chargeback system facilitates reducing
the number of chargebacks submitted to the payment processor,
freeing up network resources and bandwidth for processing payments
and increasing a speed of the payment processor. In turn, the
payment network may experience more accurate data processing and
less network traffic from chargebacks. In addition, reducing the
number of chargebacks may lead to reducing a number of issuer
declines.
[0035] The methods and systems described herein may be implemented
using computer programming or engineering techniques including
computer software, firmware, hardware or any combination or subset
thereof, wherein the technical effect may be achieved by performing
at least one of the following steps: (a) receiving, at a DA
(dispute analyzer) computing device, a dispute message from an
issuer portal containing dispute data associated with a transaction
dispute; (b) determining whether to designate the transaction
dispute described in the dispute message as either a pre-chargeback
or a chargeback; (c) transmitting chargebacks to a payment
processor; (d) transmitting pre-chargebacks to a merchant challenge
portal; (e) receiving at a DA computing device, a pre-chargeback
response message from the merchant portal; and (e) transmitting the
pre-chargeback response message to the issuer portal.
[0036] In one embodiment, a computer program is provided, and the
program is embodied on a computer-readable medium. In an example
embodiment, the system is executed on a single computer system,
without requiring a connection to a sever computer. In a further
example embodiment, the system is being run in a Windows.RTM.
environment (Windows is a registered trademark of Microsoft
Corporation, Redmond, Wash.). In yet another embodiment, the system
is run on a mainframe environment and a UNIX.RTM. server
environment (UNIX is a registered trademark of AT&T located in
New York, N.Y.). The application is flexible and designed to run in
various different environments without compromising any major
functionality. In some embodiments, the system includes multiple
components distributed among a plurality of computing devices. One
or more components may be in the form of computer-executable
instructions embodied in a computer-readable medium. The systems
and processes are not limited to the specific embodiments described
herein. In addition, components of each system and each process can
be practiced independently and separately from other components and
processes described herein. Each component and process can also be
used in combination with other assembly packages and processes.
[0037] The following detailed description illustrates embodiments
of the disclosure by way of example and not by way of limitation.
It is contemplated that the disclosure has general application to
providing a pre-chargeback system to resolve transaction disputes
between cardholders and merchants, thus providing an alternative to
the chargeback process.
[0038] As used herein, an element or step recited in the singular
and preceded with the word "a" or "an" should be understood as not
excluding plural elements or steps, unless such exclusion is
explicitly recited. Furthermore, references to "example embodiment"
or "one embodiment" of the present disclosure are not intended to
be interpreted as excluding the existence of additional embodiments
that also incorporate the recited features.
[0039] Financial transaction cards or payment cards can refer to
credit cards, debit cards, and prepaid cards. These cards can all
be used as a method of payment for performing a transaction. As
described herein, the term "financial transaction card" or "payment
card" includes cards such as credit cards, debit cards, and prepaid
cards, but also includes any other devices that may hold payment
account information, such as mobile phones, personal digital
assistants (PCAs), and key fobs.
[0040] FIG. 1 is a schematic diagram illustrating an exemplary
multi-party payment card processing system 100 for processing and
disputing payment-by-card transactions. The present system and
method relates to payment card processing system 100, such as a
credit card payment network using the Mastercard.RTM. payment
processor 106. Mastercard.RTM. payment processor 106 is a
proprietary communications standard promulgated by Mastercard
International Incorporated.RTM. for the exchange of financial
transaction data between financial institutions that are registered
with Mastercard International Incorporated.RTM.. (Mastercard is a
registered trademark of Mastercard International Incorporated
located in Purchase, N.Y.).
[0041] In payment card processing system 100, a financial
institution, such as an issuing bank 104, issues a payment card,
such as a credit card account or a debit card account, to a
cardholder 102, who uses the payment card to tender payment for a
purchase from a merchant 110. To accept payment with the payment
card, merchant 110 must normally establish an account with a
financial institution that is part of the financial payment system.
This financial institution is usually called the "merchant bank" or
the "acquiring bank" or simply "acquirer". When a cardholder 102
tenders payment for a purchase with a payment card (also known as a
financial transaction card), merchant 110 requests authorization
from merchant bank 108 for the amount of the purchase. The request
may be performed over the telephone or via a website, but is
oftentimes performed through the use of a point-of-sale terminal,
which reads the cardholder's account information from the magnetic
stripe on the payment card and communicates electronically with the
transaction processing computers of merchant bank 108.
Alternatively, merchant bank 108 may authorize a third party to
perform transaction processing on its behalf. In this case, the
point-of-sale terminal will be configured to communicate with the
third party. Such a third party is usually called a "merchant
processor" or an "acquiring processor."
[0042] Using payment processor 106, the computers of merchant bank
108 or the merchant processor will communicate with the computers
of issuing bank 104 to determine whether the cardholder's account
is in good standing and whether the purchase is covered by the
cardholder's available credit line or account balance. Based on
these determinations, the request for authorization will be
declined or accepted. If the request is accepted, the transaction
is given a bank network reference number, such as the Banknet
Reference Number used by Mastercard International
Incorporated.RTM., an authorization code, and/or other transaction
identifiers that may be used to identify the transaction.
[0043] During the authorization process of the payment card system,
the clearing process is also taking place. During the clearing
process, merchant bank 108 provides issuing bank 104 with
information relating to the sale. No money is exchanged during
clearing. Clearing (also referred to as "first presentment")
involves the exchange of data required to identify the cardholder's
account 112 such as the account number, expiration date, billing
address, amount of the sale, and/or other transaction identifiers
that may be used to identify the transaction. Along with this data,
banks in the United States also include a bank network reference
number, such as the Banknet Reference Number used by Mastercard
International Incorporated.RTM., which identifies that specific
transaction. When the issuing bank 104 receives this data, it posts
the amount of sale as a draw against the cardholder's 102 available
credit and prepares to send payment to the merchant bank 108.
[0044] When a request for authorization is accepted, the available
credit line or available account balance of cardholder's account
112 is decreased. Normally, a charge is not posted immediately to a
cardholder's account 112 because bankcard associations, such as
Mastercard International Incorporated.RTM., have promulgated rules
that do not allow a merchant to charge, or "capture," a transaction
until goods are shipped or services are delivered. When a merchant
110 ships or delivers the goods or services, merchant 110 captures
the transaction by, for example, appropriate data entry procedures
on the point-of-sale terminal. If a cardholder 102 cancels a
transaction before it is captured, a "void" is generated. If a
cardholder 102 returns goods after the transaction has been
captured, a "credit" is generated.
[0045] After a transaction is captured, the transaction is settled
between merchant 110, merchant bank 108, and issuing bank 104.
Settlement refers to the transfer of financial data or funds
between the merchant's account, merchant bank 108, and issuing bank
104 related to the transaction. Usually, transactions are captured
and accumulated into a "batch," which is settled as a group.
[0046] FIG. 2 is a schematic diagram illustrating an exemplary
multi-party network system 200 for processing payment card
chargebacks. In one embodiment, system 200 is similar to or the
same as system 100 as shown in FIG. 1. In some cases, cardholder
202 disputes a transaction that may have been carried out using
payment card system 200. A transaction dispute may occur for
technical reasons such as insufficient funds, clerical reasons such
as duplicate billing and/or incorrect amount billed, quality
reasons such as when a cardholder claims to have never received the
goods as promised, and/or fraud reasons where a cardholder did not
authorize the purchase. A transaction dispute may become a
chargeback.
[0047] To initiate a chargeback, cardholder 202 may contact issuing
bank 204 to dispute a transaction. Issuing bank 204 submits a
chargeback transaction to payment processor 206, which provides
clearing and settlement services to its registered users. Payment
processor 206 may be the same or similar to the payment processor
106 described in FIG. 1. Payment processor 206 submits the
chargeback to merchant bank 208. Merchant bank 208 either resolves
the dispute or forwards it to merchant 210. Merchant 210 either
accepts the chargeback or re-presents it back to merchant bank 208.
If merchant 210 accepts the chargeback, merchant bank 208 forwards
the response back to payment processor 206. Payment processor 206
then settles the chargeback with issuing bank 204. If merchant 210
re-presents the chargeback, merchant bank 208 rejects the
chargeback requested by issuing bank 204. Merchant bank 208 may
provide additional proof or documentation that the transaction was
valid. Based on the second presentment, issuing bank 204 either
accepts it and takes no further action, or rejects the second
presentment, which is a stage referred to as arbitration
chargeback. Once arbitration chargeback occurs, neither issuing
bank 204 nor merchant bank 208 may initiate any additional
chargebacks or presentments. At this point, a case filing is
automatically generated with payment processor 206, which issues a
financial liability decision regarding the chargeback.
[0048] FIG. 3 is a schematic diagram illustrating an exemplary
multi-party network system 300 that includes a dispute analyzer
(DA) computer device 316 and a pre-chargeback communication network
360 for designating transaction disputes as either pre-chargebacks
or chargebacks. FIG. 3 illustrates the handling of chargebacks
and/or pre-chargebacks. Network system 300 includes a cardholder
302, an issuer 304, a payment processor 306, a merchant bank 308, a
merchant 310, an issuer portal 314, DA computing device 316, and a
merchant portal 318. According to an example embodiment, rather
than initiate a chargeback using the procedure described with
respect to FIG. 2, a cardholder 302 is able to communicate with
merchant 310 using DA computing device 316, as described in FIG. 3.
A network 340 is part of a chargeback system that may be similar to
the chargeback system 200 described with respect to FIG. 2. Network
360 is a pre-chargeback network that may be used to resolve
transaction disputes designated as pre-chargebacks. Network 340 and
network 360 are two separate communication networks that are
configured to run independently of one another.
[0049] Cardholder 302 accesses issuer portal 314 to review a
cardholder payment transaction history associated with a payment
card. The transaction history includes one or more transactions
made using the payment card. Cardholder 302 selects a transaction
to dispute and transmits the dispute through issuer portal 314.
Cardholder 302 may select a dispute button or a pre-chargeback
button displayed on the user interface of issuer portal 314.
Cardholder 302 may, for example, dispute the transaction because he
or she is unsatisfied with the goods or services provided by
merchant 310, may not recognize the purchase, and/or may determine
the purchase is fraudulent.
[0050] Issuer portal 314 receives the dispute, including cardholder
dispute data. This dispute data also includes transaction data
associated with the transaction being disputed. Issuer portal 314
transmits a corresponding dispute message, containing both the
cardholder dispute data and associated transaction data, to the DA
computing device 316.
[0051] In one embodiment, DA computing device 316 analyzes the
dispute message as described above to determine whether to transmit
the dispute message to payment processor 306 as a chargeback
message or to merchant portal 318 as a pre-chargeback message. In
another embodiment, cardholder 302 is given an option in issuer
portal 314 whether to transmit the dispute data to payment
processor 306 as a chargeback message or to merchant portal 318 as
a pre-chargeback message. In still another embodiment, issuer 304
determines whether to enable cardholder 302 to transmit the dispute
data to payment processor 306 as a chargeback message or to
merchant portal 318 as a pre-chargeback message.
[0052] If a pre-chargeback message is sent from DA computing device
316 to merchant portal 318, merchant 310 can use merchant portal
318 to view the pre-chargeback message. Merchant portal 318
displays at least one pre-chargeback message, including at least
some of the dispute data, enabling merchant 310 to review new
pre-chargeback message and updates to existing pre-chargebacks.
Merchant 310 then reviews pre-chargeback message information and
can provide a pre-chargeback response message. The response may
include, for example, the merchant's intention to resolve the
pre-chargeback and may include, for example, querying the
cardholder for additional detail and/or providing store credit with
the merchant to the cardholder.
[0053] The merchant's pre-chargeback response message may be sent
to cardholder 302 through merchant portal 318 by transmitting the
pre-chargeback response message through pre-chargeback network 360
to DA computing device 316. DA computing device 316 transmits the
response message to issuer portal 314. In some embodiments,
cardholder 302 is notified of the response message as described
above.
[0054] Cardholder 302 can respond, via a messaging section in
issuer portal 314, to the merchant's pre-chargeback response
message using pre-chargeback network 360. The cardholder may agree
to a resolution proposed by the merchant in the pre-chargeback
response message. Alternatively, cardholder 302 and merchant 310
can continue to exchange messages using the above-described
process.
[0055] FIG. 4 is a data flow diagram 400 illustrating the flow of
data between components of pre-chargeback network 360 described
with respect to FIG. 3. FIG. 4 depicts the data flow between
cardholder 402 and merchant 410. In the example embodiment,
cardholder 402 and merchant 410 are the same or similar to
cardholder 302 and merchant 310 respectively. The method further
includes issuer portal 414, DA computing device 416, payment
processor 406, merchant portal 418, and merchant 410. Issuer portal
414 receives cardholder dispute data 422 from cardholder 402, which
may include one or more reasons for the transaction dispute, a
narrative regarding the disputed transaction, chosen multiple
choice options, etc. The issuer portal collects cardholder dispute
data 422 with associated transaction data 424 to generate dispute
message 420. Associated transaction data 424 includes, but is not
limited to, a primary account number (PAN) associated with the
payment card associated with the transaction, account profile data
for the PAN, a merchant identifier (ID), an acquiring bank
identifier, an issuing bank identifier, an original transaction
amount, a transaction date and time, a merchant location ID, a card
product type, a merchant category code, an authorization code,
and/or other transaction identifiers that may be used to identify
the merchant and/or the disputed transaction. The dispute message
is transmitted by the issuer server to the DA computing device.
[0056] DA computing device 416 receives dispute message 420 from
issuer portal 414. In an example embodiment, DA computing device
extracts dispute message data 432 from dispute message 420 and
stores it in database 430. Dispute message data 432 may include
keywords or indicators from dispute message 420. Database 430 also
includes historical pre-chargeback data 434 which may include
indicators historically associated with transactions that have been
resolved using the pre-chargeback system. Database 430 also
includes dispute designation model 440, constructed using dispute
message factors 442 and historical pre-chargeback data 434. Dispute
message factors 442 may be determined using natural language
processing, and/or statistical methods, and/or other machine
learning methods applied to historical pre-chargeback data 434. In
some embodiments, the dispute designation model 440 and dispute
message factors 442 are determined by the issuer. DA computing
device 416 may contain one or more dispute designation models 440
and one or more set of dispute message factors 442. In some
embodiments, the DA computing device 416 associates each issuer
portal 414 to at least one dispute designation model 440 and at
least one set of dispute message factors 442.
[0057] In one embodiment, DA computing device 416 applies dispute
designation model 440 to dispute message data 432 to designate the
transaction dispute associated with dispute message 420 as either a
chargeback or a pre-chargeback. If the dispute is designated a
chargeback, DA computing device 416 submits a chargeback message
436 to payment processor 406 to initiate the chargeback process
described with respect to FIG. 2. If the dispute is designated a
pre-chargeback. DA computing device 416 transmits the
pre-chargeback message 426 to merchant portal 418 as described with
respect to FIG. 3. The contents of dispute message 420 are
contained, in whole or in part, within pre-chargeback message 426
submitted to merchant portal 418. In another embodiment (not
shown), the cardholder determines whether to (i) transmit the
cardholder dispute data 422 through DA computing device 416 to the
payment processor 406 as a chargeback message, or (ii) transmit the
cardholder dispute data 422 through DA computing device 416 to the
merchant portal 418 as a pre-chargeback message. In such an
embodiment, DA computing device 416 does not analyze cardholder
dispute data 422. In still another embodiment (not shown), the
issuer determines whether to (i) transmit the cardholder dispute
data 422 through DA computing device 416 to the payment processor
406 as a chargeback message, or (ii) transmit the cardholder
dispute data 422 through DA computing device 416 as a
pre-chargeback message.
[0058] Upon receiving dispute message 420 and determining it is to
be routed through the pre-chargeback network as a pre-chargeback
message, DA computing device 416 transmits the pre-chargeback
message 426 to a merchant server. In one embodiment, DA computing
device 416 is configured to use dispute message 420, particularly
associated transaction data 424, to determine the merchant 410
associated with the pre-chargeback. In some embodiments, each
merchant 410 has a separate merchant portal 418. In such
embodiments, DA computing device 416 determines the particular
merchant server that provides the merchant portal 418 for the
identified merchant 410. DA computing device 416 transmits the
pre-chargeback message 426 to that merchant server. In an
alternative embodiment, all merchants 410 share a merchant portal
418 but each merchant 410 has a separate messaging section to
display, receive, and transmit message communications. In such
embodiments, DA computing device 416 transmits pre-chargeback
message 426 to a central merchant server that provides a merchant
portal 418.
[0059] Merchant portal 418 displays at least one pre-chargeback
message 426, including at least some of cardholder dispute data
422, enabling merchant 410 to review new pre-chargebacks and
updates to existing pre-chargebacks. Merchant portal 418 can be a
website/webpage, a series of websites/webpages, a web application,
or a mobile application. Merchant portal 418 further includes one
or more messaging sections to display one or more text message
communications, electronic mail (i.e., emails), and/or other
information relating to one or more pre-chargebacks. Merchant 410
then reviews pre-chargeback messages 426 and can provide a
pre-chargeback response message 450. Pre-chargeback response
message 450 can include, for example, associated response data 452
and a response indicator 454. Response indicator 454 may
communicate that merchant 410 intends to resolve the pre-chargeback
using the pre-chargeback system. Response indicator 454 may further
communicate that a full or partial credit associated with the
disputed transaction is being processed, provide store credit with
merchant 410. Associated response data 452 may include one or more
queries to cardholder 402 for additional detail.
[0060] Pre-chargeback response message 450 is transmitted by
merchant portal 418 to DA computing device 416 where it is received
by a pre-chargeback response handler 435. In one embodiment,
pre-chargeback response handler 435 is configured to use data
within pre-chargeback response message 450 to determine the issuer
portal 414 to receive pre-chargeback response message 450. In some
embodiments, cardholder 402 is notified of pre-chargeback response
message 450 as described above.
[0061] Cardholder 402 can respond (not shown), via a messaging
section in issuer portal 414, to pre-chargeback response message
450. In some embodiments, the cardholder's response can be
transmitted through pre-chargeback response handler 435 to merchant
portal 418. Cardholder 402 and merchant 410 can continue to
exchange messages using the above-described process.
[0062] FIG. 5 illustrates an example configuration 500 of a DA
computing device as shown in FIG. 4. DA computing device 516
includes a processor 504 for executing instructions. Instructions
may be stored in a memory area 506, for example. Processor 504 may
include one or more processing units (e.g., in a multi-core
configuration).
[0063] Processor 504 is operatively coupled to a communication
interface 508 such that DA computing device 516 is capable of
communicating with a remote device such as a merchant portal, an
issuing portal, or a payment processor. For example, communication
interface 508 may transmit pre-chargeback data to the merchant
portal and/or another client device via a network.
[0064] Processor 504 may also be operatively coupled to a storage
device 510. Storage device 510 is any computer-operated hardware
suitable for storing and/or retrieving data. In some embodiments,
storage device 510 is integrated in DA computing device 516. For
example, DA computing device 516 may include one or more hard disk
drives as storage device 510. In other embodiments, storage device
510 is external to DA computing device 516 and may be accessed by a
plurality of server computer devices. For example, storage device
510 may include multiple storage units such as hard disks or solid
state disks in a redundant array of inexpensive disks (RAID)
configuration. Storage device 510 may include a storage area
network (SAN) and/or a network attached storage (NAS) system.
[0065] In some embodiments, processor 504 is operatively coupled to
storage device 510 via a storage interface 512. Storage interface
512 is any component capable of providing processor 504 with access
to storage device 510. Storage interface 512 may include, for
example, an Advanced Technology Attachment (ATA) adapter, a Serial
ATA (SATA) adapter, a Small Computer System Interface (SCSI)
adapter, a RAID controller, a SAN adapter, a network adapter,
and/or any component providing processor 504 with access to storage
device 510.
[0066] Memory area 506 may include, but are not limited to, random
access memory (RAM) such as dynamic RAM (DRAM) or static RAM
(SRAM), read-only memory (ROM), erasable programmable read-only
memory (EPROM), electrically erasable programmable read-only memory
(EEPROM), and non-volatile RAM (NVRAM). The above memory types are
exemplary only, and are thus not limiting as to the types of memory
usable for storage of a computer program.
[0067] FIG. 6 is a flowchart of a method 600 for designating a
transaction dispute as a pre-chargeback for transmission over a
pre-chargeback network, such as network 360 (shown in FIG. 3). In
the example embodiment, method 600 is performed by a DA computing
device, such as DA computing device 316 (shown in FIG. 3). In
certain embodiments, method 600 may at least be partially performed
by a different computing device. In other embodiments, method 600
may include additional, fewer, or alternative actions, including
those described herein.
[0068] In 602, the DA computing device receives a transaction
dispute, including transaction dispute data, from an issuer portal.
The dispute data may include, for example, a transaction amount, a
merchant identification (ID), and a location of the merchant. In
one embodiment, the DA computing device analyses 604 the dispute
data as described above to designate 606 the transaction dispute as
a chargeback or a pre-chargeback. The DA computing device transmits
608 pre-chargebacks to a merchant portal and transmits 610
chargebacks to a payment processor.
[0069] As will be appreciated based on the foregoing specification,
the above-described examples of the disclosure may be implemented
using computer programming or engineering techniques including
computer software, firmware, hardware or any combination or subset
thereof. Any such resulting program, having computer-readable code
means, may be embodied or provided within one or more
computer-readable media, thereby making a computer program product,
i.e., an article of manufacture, according to the discussed
examples of the disclosure. The computer-readable media may be, for
example, but is not limited to, a fixed (hard) drive, diskette,
optical disk, magnetic tape, semiconductor memory such as read-only
memory (ROM), and/or any transmitting/receiving medium such as the
Internet or other communication network or link. The article of
manufacture containing the computer code may be made and/or used by
executing the code directly from one medium, by copying the code
from one medium to another medium, or by transmitting the code over
a network.
[0070] The computer programs (also known as programs, software,
software applications, "apps", or code) include machine
instructions for a programmable processor, and can be implemented
in a high-level procedural and/or object-oriented programming
language, and/or in assembly/machine language. As used herein, the
terms "machine-readable medium" "computer-readable medium" refers
to any computer program product, apparatus and/or device (e.g.,
magnetic discs, optical disks, memory, Programmable Logic Devices
(PLDs)) used to provide machine instructions and/or data to a
programmable processor, including a machine-readable medium that
receives machine instructions as a machine-readable signal. The
"machine-readable medium" and "computer-readable medium," however,
do not include transitory signals. The term "machine-readable
signal" refers to any signal used to provide machine instructions
and/or data to a programmable processor.
[0071] For example, one or more computer-readable storage media may
include computer-executable instructions embodied thereon for
determining the probability of an authorized transaction resulting
in a chargeback. In this example, the computing device may include
a memory device and a processor in communication with the memory
device, and when executed by said processor the computer-executable
instructions may cause the processor to perform a method such as
the method described and illustrated in the example of FIG. 5.
[0072] The term processor, as used herein, refers to central
processing units, microprocessors, microcontrollers, reduced
instruction set circuits (RISC), application specific integrated
circuits (ASIC), logic circuits, and any other circuit or processor
capable of executing the functions described herein.
[0073] This written description uses examples to describe
embodiments of the disclosure, including the best mode, and also to
enable any person skilled in the art to practice the disclosure,
including making and using any devices or systems and performing
any incorporated methods. The patentable scope of the disclosure is
defined by the claims, and may include other examples that occur to
those skilled in the art. Such other examples are intended to be
within the scope of the claims if they have structural elements
that do not differ from the literal language of the claims, or if
they include equivalent structural elements with insubstantial
differences from the literal language of the claims.
* * * * *