US20070106558A1 - System and method of automatic insufficient funds notification and overdraft protection - Google Patents

Abstract

A method and program product for conducting business transactions and avoiding inadvertent overdrafts. First, the value of an intended purchase is estimated and an electronic receipt is generated for the estimate. An account identified for payment (e.g., a checking account or a credit card account) is analyzed for sufficient funds and, alerts may be provided whenever the analysis indicates that the account has insufficient funds. As a result of the alert, the purchase may be halted or another form of payment may be selected. Also, total in-store purchases may be estimated and other accounts may be analyzed to determine if, in addition to being overdrawn for the selected account, the transaction is over budget.

Description

CROSS REFERENCE TO RELATED APPLICATIONS
• The present invention is a continuation in part of published U.S. patent application Ser. No. 10/430,824 (Attorney Docket No. BLD920030021US1), entitled “Point-of-Sale Receipt Electronic Generation” to Joan L. Mitchell et al., filed May 6, 2003 and published Nov. 11, 2004, publication No. 2004/0225567 A1; and related to U.S. Pat. No. 6,883,706 B2 (Attorney Docket No. BLD920030020US1), entitled “Point-of-Sale Bill Authentication” to Scott D. Mastie et al., issued Apr. 26, 2005; and to published U.S. patent application Ser. No. 10/446,204 (Attorney Docket No. BLD920030019US1), entitled “Expense Accounting Data Management Based on Electronic Expense Document” to Joan L. Mitchell et al., filed May 27, 2003 and published Dec. 2, 2004, publication No. 2004/0243489 A1; all assigned to the assignee of the present invention and incorporated herein by reference.
BACKGROUND OF THE INVENTION
• 1. Field of the Invention
• The present invention generally relates to business transactions and more particularly to in-store business transactions and payment of such in-store business transactions and self service transactions at electronic Point of Sale kiosks, such as at automated gas pumps and the like.
• 2. Background Description
• Frequently, new businesses fail because of cash-flow problems and under capitalization. Often this is because a new business person finds it difficult tracking business expenses. Also, the typical 30-90 day lag time between invoicing and payment can cause budgeting problems, even when accounts receivable sufficiently cover ordinary expenses. Bad or bounced checks further deplete business resources and are not reflected on the balance sheet until marked as a loss. So, while the balance sheet may indicate that the business is in the black, a large accounts receivable may leave the business cash poor and unable to meet payroll or pay creditors on time.
• Moreover, tracking bills, payments and receipts can be a very time consuming process. A business may have multiple employees on expense accounts or otherwise spending company money, each too busy to take time to promptly account for expenditures. Even if business promptly entered expenditures and receipts in the books, many businesses only balance their financial books/checkbooks once a month. There are a number of commercially available accounting software packages to assist small businesses in these complicated and time-consuming accounting tasks. Unfortunately, these off-the-shelf packages depend upon either manually entering the data or periodically downloading checking account and credit card information from multiple accounts.
• These types of expenditure problems are not limited to new businesses; individuals and families frequently encounter similar cash flow problems as well. Financial difficulties arising from these types of monetary issues can stress a marriage to the breaking point. For example, couples may use a joint bank account and have joint credit card accounts; individually drawing on the same account and independently charging purchases to their joint accounts. When one or both of the partners is lax about recording joint account transactions, the charges may reach the credit card limit and/or the account may become overdrawn without either party realizing the problem. Consequently, outstanding checks can exceed available funds and some may even bounce for insufficient funds. Without available funds, credit card payment due dates may pass without payment, leaving the credit cards unpaid. Bounced checks and missed credit card payments injure both partners' credit rating. Unfortunately, these bounced checks and missed credit card payments incur large penalties that further exacerbate the problem, potentially stretching an already tight budget past the breaking point. If, for example, one partner is susceptible to “impulse buying,” spontaneously making unplanned purchases, the couples' budget may be blown before the other partner is aware of the problem. For these and other reasons, marital finances have been named, consistently, the top source of marital strife.
• Thus, there is a need for notifying individuals and business of potential budgetary problems in real time; more particularly, for notifying the appropriate individual(s) of such potential budgetary problems based on estimated spending that accounts are in danger of being overdrawn; and, optionally, preventing parties from overdrawing the account(s).
SUMMARY OF THE INVENTION
• It is therefore a purpose of the invention to reduce inadvertent overdrafts and unbudgeted/over-budget expenditures;
• It is another purpose of this invention to selectively allow business transactions to go forward even with insufficient funds in an account initially selected for payment;
• It is yet another purpose of the invention to reduce inadvertent overdrafts in point-of-sale terminal purchases.
• The present invention is related to a method and program product for conducting business transactions and avoiding inadvertent overdrafts. First, the value of an intended purchase is estimated and an electronic receipt is generated for the estimate. An account identified for payment (e.g., a checking account or a credit card account) is analyzed for sufficient funds and alerts may be provided whenever the analysis indicates that the account has insufficient funds. As a result of the alert, the purchase may be halted or another form of payment may be selected. Also, total in-store purchases may be estimated and other accounts may be analyzed to determine if, in addition to being overdrawn for the selected account, the transaction is over budget.
BRIEF DESCRIPTION OF THE DRAWINGS
• The foregoing and other objects, aspects and advantages will be better understood from the following detailed description of a preferred embodiment of the invention with reference to the drawings, in which:
• FIG. 1 shows an example of a preferred point-of-sale (POS) terminal electronic receipt generation environment, for customer transacting business at POS terminals.
• FIG. 2 shows a flow chart example of notifying a business/merchant that an account is becoming overdrawn by a purchaser/customer in the environment ofFIG. 1.
• FIG. 3 shows a flow chart example providing optional consumer purchase estimates, wherein a customer estimates the availability of funds.
• FIG. 4 shows another flow chart example of an over total budget estimate based on a purchase estimate.
• FIG. 5 shows a flow chart example of optionally providing over-budget alerts based on the itemized electronic receipt, e.g., as a result of an over total budget estimate.
DESCRIPTION OF PREFERRED EMBODIMENTS
• Turning now to the drawings, and more particularly,FIG. 1 shows an example of a preferred point-of-sale (POS) terminal electronicreceipt generation environment10, customer location (i.e., identified with a client business)12 and point-of-sale terminal14 (hereinafter “POS terminal14”), such as described in published U.S. patent application Ser. No. 10/430,824 (Attorney Docket No. BLD920030021US1), entitled “Point-of-Sale Electronic Receipt Generation” to Joan L. Mitchell et al., filed May 6, 2003, published Nov. 11, 2004, publication No. 2004/0225567 A1, assigned to the assignee of the present invention and incorporated herein by reference.Customer locations12, e.g., a wallet that includes, for example,cash16, acheck18, acredit card20 and/or asmart card22, or any other suitable well known payment mechanisms for paying for merchandise, e.g., gift certificates or store credits.Customer location12 may also communicate withPOS terminal14 using a personal digital assistant (PDA)24 or any other suitable handheld computer or communication system, with an appropriate communication port (not shown), e.g., infrared (IR) or radio frequency identification (RFID).POS terminal14 conducts each sales transaction and generates anelectronic receipt26 for each and, optionally, aconventional paper receipt28. According to a preferred embodiment of the present invention, individuals, families, and businesses receive real time cash-flow and budget analysis, and as a byproduct of each transaction, improved financial health.
• As used herein for example only, a customer, shopper or purchaser (used interchangeably) at acustomer location12 is identified with a private or public concern is conducting a transaction with a merchant or other business concern. The private concern may be, for example an individual household, a business or other organization or business. Similarly, a public concern may be, for example, a business or a non-profit organization. Thus, a customer/purchaser may be a member of the household, a business employee or a member of the organization. ThePOS14 is located with thebusiness concern30, e.g., in a bank, on the premises of a department or grocery store or, is suitably located for electronic purchases (e-purchases). Further, either or both of the customers to the business concern and the private/public concern are proactively alerted or notified of budgetary problems, even from available downloadable information that normally does not include sufficient budgetary detail, e.g., to automatically assign each purchase to a budget category. Thus, the present invention facilitates budget compliance, even when a particular customer is not paying attention to the effects of individual purchases during shopping, to mitigate the effects of impulse-buying and other extra-budgeted purchases.
• EachPOS terminal14 may be located oncustomer premises30, e.g., a bank, or be remotely located and include animager40, a check/currency inserter42, areceipt instruction receiver46 with areceipt destination retriever62, an electronic receipt generator (ERG)48 with an authenticating data generator (ADG)50, atransmitter52 and any other components (OC)54.Imager40 converts cash (paper currency or bills)16, and/orchecks18 intoimages58 that may be inserted by check/currency inserter42 into a paper receipt,28 anelectronic receipt26 or both for recordation. Electronic receipt generation and storage is also described, for example, in published U.S. patent application Ser. No. 10/446,204 (Attorney Docket No. BLD920030019US1) entitled “Expense Accounting Data Management Based on Electronic Expense Document” to Joan L. Mitchell et al., filed May 27, 2003, published Dec. 2, 2004, publication No. 2004/0243489 A1, assigned to the assignee of the present invention and incorporated herein by reference. Receipt instruction receiver (RIR)46 may include a destination retriever (DR)62 and receive receipt instructions (RI)60. Eachreceipt instruction60 includes a Receipt Destination Identifier (RDI)64 and a content instruction (CI)66. Areceipt instruction60 reflects communicated customer preferences, e.g., provided verbally and manually entered toPOS terminal14 or electronically generated. Electronically generated customer preferences may be gathered, for example, from an electronic payment from, for example, acredit card20, asmart card22, aPDA24 or any other suitable electronic payment mechanism.
• EachRDI64 expressly or implicitly indicates where to send a corresponding electronic receipt, if any. AnRDI64 may expressly state areceipt destination65 as, for example, an Internet protocol (IP) address, a mailing address, an e-mail address, e.g., for a non-volatile storage. Customer identification may imply areceipt destination65 stored in areceipt destination database68, e.g., by business name, by credit card number, by smart card identification, or by PDA based IR communications. Thedestination retriever62 retrieves implied destinations fromreceipt destination database68. Theelectronic receipt generator48 generates anelectronic receipt26 for each transaction, e.g., from date and time; merchant; issuing agent; and merchant address. Electronic receipts may be in a standard format, e.g., electronic data interchange (EDI) format or a personalizedelectronic receipts26 based oncontent instruction66, e.g., indicated in acontent database70.Authentication data generator50 can providetransaction authentication data72 for confirming that anelectronic receipt26 has not been altered. For example,authentication data72 may include receipt contents, date, time, a merchant identification or, biometric data collected from the purchaser. Theauthentication data72 may be stored at amerchant system74 for access byreceipt destination65 with eachreceipt26 or transmitted separately toreceipt destination65. Thetransmitter52 communicateselectronic receipts26 andauthentication data72 toreceipt destinations65 and/ormerchant system74.Other POS terminal14components54 may include, for example, a keyboard, a central processing unit (CPU), a monitor, a bar code scanner, a telecommunications system, a credit card authentication system, a smart card authentication system, a PDA communications system, RFID detection modules and/or a cash drawer.
• Preferably,receipt destination65 includes anexpense accounting system80 such as a customer employer expense reporting system, a customer personal expense tracking system (e.g., Quicken®, Microsoft Money®, TurboTax® or a spreadsheet application) and/or a customer accountant expense tracking system. Eachelectronic receipt26 provides immediate information for cash flow and budget purposes to expenseaccounting system80. Also, theexpense account system80 may include an expense categorizer (EC)82 categorizing eachelectronic receipt26 into an expense category, e.g., clothing, food, or entertainment. A tax data collector (TDC)84 gathers tax related data inelectronic receipts26, e.g., sales tax, deductible expenses, deductible donations, and medical expenses. A tax authority (TA)86 (e.g., the US Internal Revenue Service (IRS), a state tax department, or foreign equivalent thereof) may provide tax related information or, tax related information may be otherwise provided. Also, thereceipt destination65 may includeappropriate receipt storage88 for long term archiving.
• FIG. 2 shows a flow chart example100 of notifying a business concern according to a preferred embodiment of the present invention that an account may be under-funded and so, not have sufficient funds to cover a current transaction, e.g., a purchase or purchases by a purchaser in theenvironment10 ofFIG. 1. Prior to making a purchase, instep102 the business/merchant may obtain an estimate of each customer's purchases, e.g., atPOS terminal14. Instep104 thePOS terminal14 scans the selected form of payment, e.g., check18,credit card20,smart card22 and/orPDA24. Instep106 thePOS14 generates a temporaryelectronic receipt26, which thePOS14 forwards to thereceipt destination65. Instep108 theExpense Account System80, for example, analyzes the corresponding bank or credit account to determine if the account is under-funded and, as a result of the current purchase, it may become overdrawn instep108. A suitable example of using electronic receipts for real-time analysis of cash-flow and budgeting is disclosed in published U.S. patent application Ser. No. 10/430,824 (Attorney Docket No. BLD920030021US1) entitled “Point-of-Sale Receipt Generation” to Joan L. Mitchell et al., filed May 6, 2003 and published Nov. 11, 2004, publication No. 2004/0225567 A1.
• If instep110 the corresponding account has sufficient funds or remaining credit to complete the current purchase, then the purchase proceeds instep112, e.g., by finalizing the temporary electronic receipt for the current customer. Otherwise, if the customer is under-funded instep108, such that the current purchase exceeds customer funds and the corresponding account will be overdrawn or a credit limit will be exceeded; then instep114 the business/merchant is alerted, e.g., by a POS terminal message. Thus, the business/merchant receives an application alert or another notification when a customer has exceeded his/her purchasing authority, e.g., is exceeding the budget or an account will be overdrawn. Then, optionally, instep116 the customer also is notified, e.g., by a message displayed on the credit card/smart card scanner, or on thePDA24, and the customer may select another form of payment, e.g.,cash16 instead ofcredit card20 or a different credit card. Thus, overdraft notification enables purchasers to switch the method of payment or transfer funds on-the-fly and in real time to avoid incurring bounced check and/or overdraft fees. Moreover, the business/merchant avoids the aggravation of collecting bad or bounced checks. Optionally, the respective bank/creditor may offer additional account protection services, e.g., verifying that the customer has subscribed to the service instep108 and only providing an indication for subscribers. For example, services may be offered to help individuals, families and businesses to avoid insufficient funds or over-credit situations that would otherwise arise.
• FIG. 3 shows a flow chart example120 of providing optional consumer purchase estimates, wherein a customer estimates or calculates the purchase cost and the availability of funds according to a preferred embodiment of the present invention. Instep122 the purchaser decides whether to check for sufficient funds or remaining available credit to cover current purchases in one or more accounts. If an estimate is unnecessary, then the purchase proceeds instep124. Otherwise, instep126 the customer calculates or estimates a total for current purchases. The result is forwarded to thereceipt destination65 and instep128 theExpense Account System80, for example, analyzes the corresponding bank or credit account in real time. Instep130 the results of the real-time analysis are returned to the customer to determine if the current purchase exceeds available funds instep132. If sufficient funds are available to complete the current purchase in step, then the purchase proceeds instep124. Otherwise, if instep132 the current purchase exceeds the available funds such that the corresponding account will be overdrawn or the credit limit exceeded; then instep134 the customer is notified, e.g., by a message displayed on the credit card/smart card scanner, or on thePDA24, and the customer may select another form of payment to complete the purchase instep124, e.g., usingcash16 instead ofcredit card20. Thus, these alerts enable purchasers to switch the method of payment or transfer funds on-the-fly and in real time to avoid incurring the bounced check and overdraft fees.
• So, for example, upon entering the cashier's line and deciding to request a purchase estimate instep122; then instep126, the customer can forward an expected purchase amount, e.g., an estimate or a calculated amount. For example, the customer can access a bank or credit account by cell phone, PDA, or other handheld device (or use a merchant's kiosk such as an ATM machine in a store or on an automated gas pump) and, enter the expected amount for purchasing the merchandise instep128. Multiple responses can be returned instep130 including “OK,” “Borderline” (e.g., within $200 or a certain minimum funding limit), and “insufficient funds.” Once the purchase is complete instep124, the expected amount is replaced with the final purchase amount from the electronic detailed receipt. Meanwhile other purchasers using the same account are warned based on the updated available funds, to have current data and avoid secondary over-credit or insufficient funds instances. Thus, the public/private concern avoids having compounded the problem, and may avoid it altogether.
• FIG. 4 shows a flow chart example140 of an over total budget estimate based on a purchase estimate, substantially similar to the example ofFIG. 3 with like elements labeled identically. Again instep122 the purchaser decides whether to check for sufficient funds to cover current purchases in one or more accounts. If an estimate is unnecessary, then instep124, the purchase proceeds. Otherwise, instep126 the customer estimates the total for current purchases. The estimate is forwarded to thereceipt destination65 and instep142 theExpense Account System80, for example, analyzes the customer's budget in real time. Instep144 the results of the real-time analysis are checked to determine if the budget will be exceeded as a result of the current purchase. If sufficient budgetary resources are available to complete the current purchase instep144, then the purchase proceeds instep124. Otherwise, if instep144 the budget or a budget sub-category will be exceeded; then, instep146 the purchase is halted, e.g., by a message displayed on the credit card/smart card scanner, or on thePDA24. Optionally, the customer may be allowed to select another form of payment to complete the purchase instep124, e.g., usingcash16 instead ofcredit card20, or replenish necessary funds before close-of-business, to prevent expensive insufficient funds situations. Optionally, the customer may elect to override the budget warning, provided that sufficient funds exist. For example, it may be unavoidable to exceed fuel budget limits, causing the customer to make other adjustments to cover the purchase and avoid a bounced check, an overdraft or a rejected credit card. Thus, over-budget notification enables individuals/businesses to stop such purchases on-the-fly and in real time, also to avoid incurring the results of an under-funded account, e.g., a bounced check, overdraft fees or an over-credit situation. Also, the customer may adjust budgeted amounts to prevent generating budget alerts.
• FIG. 5 shows a flow chart example150 of optionally providing over-budget alerts based on the itemized electronic receipt, e.g., as a result of an overtotal budget estimate140 of the example ofFIG. 4. When the results of account analysis indicate that a current purchase exceeds a total budget for the private/public concern, in step152 a budget alert is generated. In response to the alert, instep154 recent receipts are scanned. Then, instep156 the concern's accounts are analyzed to identify any purchases that have exceeded budget. Finally instep158, thereceipt destination65 alerts the customer of any identified purchases, e.g. to stop or alter the purchases.
• Advantageously, purchases can be halted before bouncing checks, incurring overdraft penalties, exceeding credit limits, exceeding budgetary guidelines or otherwise injuring negatively affecting credit scores and reports. Customers have an accurate, up-to-date accounting of available funds relative to the respective budget. The accounting may be used, for example, for education regarding monthly living expenses. Further, such an accurate up-to-date accounting reduces the likelihood of inadvertently creating debt by exceeding available funds (e.g., by check, credit card, or e-purchase) and may encourage personal responsibility. With notification provided by the present invention customers can avoid otherwise inadvertent overdrafts and resulting bounced checks, e.g., by aborting purchases or transferring money into a depleted account. A customer can query bank accounts even before initiating a transaction and while waiting in line, e.g., from a PDA, handheld computer, or cell phone and confirm that an estimated or calculated amount will not exceed available funds. Moreover, merchants can accept checks verified at a preferred POS terminal according to a preferred embodiment of the present invention without concern that such checks may bounce.
• Also, the present invention provides immediate purchase verification for an additional level of overdraft protection, e.g., banks may institute an “instant overdraft” option whereby banking customers receive proactive notice of potentially overdrawn situations. Many banks currently offer “overdraft insurance,” that allows individuals to replenish overdrawn funds, rather than allowing protected accounts to be overdrawn, bouncing a check. Instead, banks offering “instant overdraft” protection can allow customers to OK an overdraft on-the-spot, e.g., for an appropriate interest charge. Thus, purchases may complete with otherwise rejected checks (even checks that would cause the account to be overdrawn), e.g., with the customer's promise to replenish the account before close-of-business or by the customer funding the purchase from another account. Further, such an “instant overdraft” protection option provides banks with a new revenue service opportunity, allowing a real-time funds-balance-verification, that may be marketed as a fee-based value-add offering, or services related to such an offering.
• While the invention has been described in terms of preferred embodiments, those skilled in the art will recognize that the invention can be practiced with modification within the spirit and scope of the appended claims. It is intended that all such variations and modifications fall within the scope of the appended claims. Examples and drawings are, accordingly, to be regarded as illustrative rather than restrictive.

Claims (20)

1. A method of conducting business transactions, said method comprising the steps of:

a) estimating the value of an intended purchase;

b) generating an electronic receipt for said intended purchase from the estimate;

c) analyzing an account for payment for sufficient funds; and

d) selectively providing an alert responsive to an indication that said account has insufficient funds.

2. A method as inclaim 1, wherein the step (a) of estimating comprises estimating the total value of in-store purchases for an identified customer.

3. A method as inclaim 2, wherein the analyzing step (c) further comprises analyzing a plurality of accounts to determine whether said intended purchase exceeds a current total budget.

4. A method as inclaim 3, wherein the step (d) of selectively providing an alert comprises halting said intended purchase.

5. A method as inclaim 1, wherein the analyzing step (c) further comprises analyzing a plurality of accounts to determine whether said intended purchase exceeds a current total budget.

6. A method as inclaim 1, wherein the step (d) of selectively providing an alert comprises halting said intended purchase.

7. A method as inclaim 1, wherein the step (b) of generating said electronic receipt comprises scanning an intended form of purchase.

8. A method as inclaim 7, wherein said intended form of purchase is selected from one of a check, a credit card and a smart card.

9. A method as inclaim 8, further comprising the step of:

e) identifying another form of purchase responsive to a generated said alert.

10. A method as inclaim 1, further comprising the step of:

e) identifying another form of purchase responsive to a generated said alert.

11. A method as inclaim 1, wherein said account is a bank account, said method providing overdraft protection, said method further comprising the step of:

e) identifying another form of purchase responsive to a generated said alert.

12. A method of providing overdraft protection as inclaim 1, wherein the step (c) of analyzing further comprises verifying that the account is identified with a customer subscribed to an overdraft protection service, alerts being provided in step (d) only for overdraft protection service subscribers.

13. A computer program product for conducting business transactions, said computer program product comprising a computer usable medium having computer readable program code thereon, said computer readable program code comprising:

computer program code means for receiving estimates of intended purchases;

computer program code means for generating electronic receipts for each received estimate;

computer program code means for analyzing payment accounts for sufficient funds for covering said each received estimate; and

computer program code means for providing alerts responsive to an indication that an account has insufficient funds.

14. A computer program product for conducting business transactions as inclaim 13, wherein said computer program code means for estimating comprises computer program code means for receiving estimates of the total value of in-store purchases for an identified customer.

15. A computer program product for conducting business transactions as inclaim 13, wherein the computer readable program code means for analyzing comprises:

computer program code means for analyzing a plurality of accounts; and

computer program code means for determining whether said intended purchase exceeds a current total budget.

16. A computer program product for conducting business transactions as inclaim 13, wherein the computer program code means for providing an alert comprises computer program code means for halting said intended purchase.

17. A computer program product for conducting business transactions as inclaim 13, wherein the computer program code means for generating said electronic receipts comprises computer program code means for receiving scans of intended forms of purchase.

18. A computer program product for conducting business transactions as inclaim 17, wherein said intended forms of purchase include checks drawing on a checking account, a credit card for a credit card account and a smart card.

19. A computer program product for conducting business transactions as inclaim 13, further comprising:

computer program code means for identifying an alternate payment account.

20. A computer program product for conducting business transactions as inclaim 13, wherein the computer program code means for analyzing verifies that bank accounts are identified with customers subscribed to an overdraft protection service, and said computer program code means for providing alerts provides alerts only for overdraft protection service subscribers.

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