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Computerized system for facilitating transactions between parties on the internet using e-mail

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Title: Computerized system for facilitating transactions between parties on the internet using e-mail.
Abstract: A payment system and method are disclosed for processing financial exchanges over a network between a merchant and a buyer. For example, receiving from a merchant, over the network, information associated with a financial transaction and non-financial data relating to a buyer involved in the financial transaction. Authorizing payment, associated with the financial transaction, to the merchant on behalf of the buyer using the non-financial data related to the buyer. A notification of the authorized payment on behalf of the buyer is sent to the merchant over the network. Upon notification from the merchant that the buyer has committed to completing the financial transaction, processing payment to the merchant on behalf of the buyer. ...


USPTO Applicaton #: #20110137751 - Class: 705 2643 (USPTO) - 06/09/11 - Class 705 


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The Patent Description & Claims data below is from USPTO Patent Application 20110137751, Computerized system for facilitating transactions between parties on the internet using e-mail.

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RELATED APPLICATIONS

This application is a continuation of Reissue Application No. 10/461,604, filed Jun. 12, 2003, which is a Reissue of U.S. Pat. No. 6,246,996, issued Jun. 12, 2001, which is a continuation of U.S. Pat. No. 5,826,241, issued on Oct. 20, 1998, all of which are incorporated herein by reference in their entirety.

BACKGROUND OF THE INVENTION

The present invention relates to a system for enabling payment for information products that can be transferred electronically over a nonsecure network, and more particularly, the present invention relates to a payment system that can be used to enable an Internet user to make a payment to another Internet user for information products of value that can be electronically transferred over the Internet.

The Internet has emerged as a large community of electronically-connected users located around the world who readily and regularly exchange significant amounts of information. The Internet continues to serve its original purposes of providing for access and exchange of information among government agencies, laboratories, and universities for research and education. In addition, the Internet has evolved to serve a variety of interests and forums that extend beyond its original goals.

The Internet has been considered as a potential new marketplace for information products. It is now physically possible to transfer information products such as articles, software, cartoons, etc., via the Internet.

Using the Internet as a marketplace has several advantages. Information products can be delivered electronically without physical packaging. Because information is easily duplicated with the point and click of a mouse on a user\'s workstation, the cost of manufacturing and reproducing inventory closely approaches zero, leaving the cost of creating or synthesizing the information as the dominant cost. Once an information product has been developed, there may be little or no cost of manufacturing or inventory since a copy of the product can be shipped whenever a buyer makes a purchase given that the merchant has the bandwidth available. Given that the cost of inventory on the Internet is close to zero, there are potentially tens of thousands of information sellers, i.e. people with ideas or information products to sell, on the Internet. Another advantage of using the Internet as a marketplace is that, depending on the kind of information product involved, processing of a buyer\'s order can be automated, so there is no need for a worker to manually intervene to complete a transaction.

Although the Internet presently has the capability to serve as a marketplace for new information products, use of the Internet for this purpose has been slow to develop. One reason that accounts for this lack of development is that it is difficult to pay for information products using the Internet. A user cannot send cash or a check via the Internet and sending a check via physical delivery services is slow. Sending a credit card number over the Internet poses security problems. Moreover, even if it were reasonably safe to send credit card numbers, there are a lot of potential sellers of information products who do not have—and could not qualify for—the required merchant accounts. Credit card companies require a seller who accepts credit card for payment, to have a merchant account. Conventional merchant accounts require a relatively high standard of credit worthiness and a financial guarantee. The need for a conventional merchant account impedes commerce in the Internet marketplace because an average Internet user may have a difficult time qualifying for a merchant account.

Accordingly, there is a need for a system that solves the payment problem on the Internet to enable development of a commercial market.

SUMMARY

OF THE INVENTION

According to a first embodiment of the present invention, there is provided a method and payment system for enabling a first Internet user to make a payment to a second Internet user, typically for the purchase of an information product deliverable over the Internet. The payment system provides cardholder accounts for the first and second Internet users. When the second user sends the information product to the first user over the Internet, the second user also makes a request over the Internet to a front end portion of the payment system requesting payment from the first user. The front end portion of the payment system queries the first user over the Internet whether to proceed with payment to the second user. If the first user replies affirmatively, a charge to the first user is processed off the Internet; however if the first user replies negatively, the first user is not charged for the information product. The payment system informs the second user regarding whether the first user\'s decision and pays the second user upon collection of the charge from the first user. Security is maintained by isolating financial and credit information of users\' cardholder accounts from the front end portion of the payment system and by isolating the account identifying information from the associated e-mail address.

BRIEF DESCRIPTION OF THE DRAWINGS

These and other features, aspects, and advantages of the present invention will become better understood with regard to the following description, appended claims, and accompanying drawings where:

FIG. 1 is a block diagram illustrating the relationship between a payment system of a first embodiment of the present invention to a large network.

FIG. 2 is a block diagram of a hardware configuration for the payment system of FIG. 1.

FIG. 3 is a block diagram of the program arrangement of the payment system of FIG. 1;

FIG. 4 is a diagram of data for a cardholder account for use with the payment system of FIG. 1;

FIG. 5 is a flow chart showing message flow for the initial steps of a funds transaction using the payment system of FIG. 1;

FIGS. 6A-6Q are diagrams of data messages used in connection with the payment system of FIG. 1;

FIG. 7 is a flow chart showing the message flow for a cardholder inquiry request using the payment system of FIG. 1;

FIG. 8 is a flow chart showing the message flow for a transfer query request and reply using the payment system of FIG. 1;

FIG. 9 is a flow chart showing the message flow for payment failure using the payment system of FIG. 1;

FIG. 10 is a flow chart showing the message flow for payment notification using the payment system of FIG. 1;

FIG. 11 is a flow chart showing message flow for a chargeback process using the payment system of FIG. 1;

FIG. 12 is a flow chart showing message flow for a capabilities request process using the payment system of FIG. 1; and

FIG. 13 is a message flow diagram showing messages for a new account transaction between a user and the payment system of FIG. 1.

DETAILED DESCRIPTION

OF THE PREFERRED EMBODIMENTS I. Overall System

FIG. 1 shows a block diagram of a first embodiment of the present invention for a payment system 10. The payment system 10 is shown in relation to the Internet network 12. The Internet network 12 is a large, quasi-public network having many users 14. The Internet network 12 is of a type that the users 14 can access by various means such as conventional commercial telephone systems. The network 12 provides numerous services for its users such as e-mail or World Wide Web (WWW). Although the payment system 10 is specifically useful for the Internet, it may be used in conjunction with other e-mail based systems having a plurality of users.

In the embodiment of FIG. 1, one of the users 14 (designated as an information buyer 20) wishes to acquire an information product 26 from another of the users (designated as an information seller 28). The information seller 28 may be any user with an information product to vend. The information product 26 can be any item that is transferable over the Internet network 12. The information product 26 may be a message, an article, an original work of authorship, a composition, a writing, music, a pictorial work, a drawing, a cartoon, a story, a software program, a recipe, jokes, and so on. The information seller 28 wishes to sell a copy of the information product 26 to the information buyer 20 at a price. The price may be an advertised price (e.g. advertised over the Internet, on a bulletin board, or other media), or may be a negotiated price (e.g. negotiated via e-mail exchange). Although the example of FIG. 1 shows only one information seller 28 and one information buyer 20, the payment system 10 is understood to extend to include multiple buyers of one seller, multiple sellers to one buyer, and multiple sellers and multiple buyers. Also, a buyer or a seller may be an individual, a company, or an institution.

Also shown in FIG. 1 is a financial transaction settlement system 30. The financial transaction settlement system 30 represents presently-available commercial institutions that process credit and other financial transactions. For example, the financial transaction settlement system 30 may represent commercially available credit card processing institutions (e.g. Visa, Master Card, Discover, and so on). The financial transaction settlement system 30 includes two components: an issuer 32 and an acquirer 34. The issuer 32 includes banks, or other institutions, that issue credit cards to persons, sends statements and bills to credit card holders on a regular basis, and collects payment from the credit card holders. These functions are not performed on the Internet but use conventional mail delivery, authorized direct withdrawals from bank accounts, etc. The payment system 10 of the present embodiment utilizes these commercially available issuers 32 to bill users and to collect payment from users for their transactions on the Internet 12 using the payment system 10. For example, a user\'s transactions using the Internet would show up on the user\'s credit card statement as a charge from the payment system 10 although individual transactions using the payment system 10 on the Internet 12 may not be specifically listed on the credit card statement. The financial transaction settlement system 30 also includes the acquirer component 34. This acquirer component 34 is a bank or other institution that provides a merchant account to the payment system 10. The merchant account provided to the payment system 10 is similar or identical to the conventional merchant accounts that are provided to other businesses. By means of having the merchant account, the payment system 10 forwards user charges to the acquirer component 34 thereby getting user charges into a conventional, commercially-available settlement system. As mentioned above, the acquirer 34 processes the user charges received from the payment system and passes this information to the issuer component 32 for the preparation and sending of monthly statements and bills to users and collecting payment from users.

FIG. 2 is a block diagram illustrating one possible configuration of hardware components used to implement the payment system 10 of FIG. 1. The payment system 10 includes two computers: a front end computer 50 and a back end computer 52. The front end computer 50 and the back end computer 52 are connected together via a private network 53. In a preferred embodiment, the private network is an Ethernet network. The front end computer 50 includes a front end system board 54 associated with a front end memory 56, a storage device 58 such as a fixed disk drive, a back up tape drive 60, a removable media drive 62, a monitor 64, and a power supply 66. The front end computer 50 is connected to the Internet 12 is by means of a leased T1 line 69.

The back end computer 52 includes a back end computer system board 68 associated with a back end computer memory 70, a back end computer storage device 72 such as a fixed disk drive, a back up tape drive 74, a removable media drive 76, a monitor 78, and a power supply 80. The back end computer 52 is connected to the front end computer 50 by means of Ethernet cable. The back end computer 52 also has a Novell LAN 81 that provides a communication link to the settlement system 30.

Both the front end computer 50 and the back end computer 52 in this embodiment are preferably commercially available Sun Microsystems SS1000 computers. Preferably, both the front end computer 50 and the back end computer 52 are equipped with 64 MB memory. The dedicated private network is an Ethernet and includes a SBus host adaptor. The communication server is a Sun Microsystems SPARCserver 1000. Both the front end monitor 64 and the back end monitor 78 are commercially available Sun 17″ monitors. The front end and back end tape drives are Python SGB tape drives using 4 mm tape available from Sony, Inc. The front end disk drive 58 and the back end disk drive 72 are commercially available Seagate 1.7 GB disk drives. The host adaptor is a Sun Microsystems SBus host adaptor. The network server is a commercially available Sun Microsystems SSarray 101.

Referring to FIG. 3, the front end computer 50 runs a front end program 90. The front end program 90 is a software program that provides for communication with users 14 on the Internet network 12. The front end program 90 includes several modules that can be accessed and used by users 14 of the Internet. The modules included on the front end program include modules that permit users 14 to make a funds transfer transaction 91, to check a subscriber\'s status 92, to enroll as subscribers 93, etc.

The back end computer 52 runs a back end program 92. Thus, the front end program 90 is physically separate and isolated from the back end program 92. The back end program 92 receives information from and sends information to the front end program 90 only by means of batch processing. This results in an inherently safe method of communicating between the publicly accessible part of the payment system, i.e. the front end computer 50, and the secure part of the payment system, i.e. the back end computer 52.

II. Requirements of a Subscriber

In order to use the payment system 10 for transactions, the information buyer 20 and the information seller 28 both need to have subscriber or cardholder accounts with the payment system 10. As subscribers, users of the Internet network 12 may conduct commercial transactions with each other, such as paying for information products 26, making charitable contributions, etc.

Referring to FIG. 4, a cardholder account 100 includes at least the following information: a cardnumber 102, an Internet e-mail address 104, a state 106, a pay-in selection 108, a pay-out selection 110, and a currency preference 112. Each of these items is explained below.

The cardnumber 102 uniquely identifies the cardholder account 100. The cardnumber 102 is an alphanumeric string that is easily typed and read by a human. Also, the cardnumber 102 is relatively hard to guess and bears no deducible relationship to any financial artifact, such as a credit cardnumber, a checking account number, nor to any e-mail address.

The cardholder Internet e-mail address 104 is the e-mail address of the cardholder that is unique for each user of the Internet.

The state 106 is one of “active”, “suspended”, or, “invalid”.

The pay-in selection 108 is how the cardholder transfers funds, i.e. makes payment, to the payment system 10. Typically, this may be done by using a conventional authorization to charge a credit card. The pay-in selection is not encoded in or directly derivable from the cardnumber.

The pay-out selection 110 is how a the payment system 10 transfers funds to, i.e. pays, the cardholder. This may include use of a direct deposit checking account, etc. The pay-out selection 110 is not encoded in or directly derivable from the cardnumber.

The currency preference 112 is the national currency used for the pay-in selection 108 and pay-out selection 110 between the payment system 10 and the subscriber.

Subscriber account information is distributed in the payment system 10. Referring again to FIG. 3, only a portion of the subscriber account information resides on the front end computer 50 where it is accessible by the front end program 90. However, a full copy of all the cardholder account information resides on the back end computer 52 where it is accessible by the back end program 92. Included on the back end computer 52 is a copy of the portion of the cardholder information on the front end computer 50. Specifically, the part of the subscriber account information that resides on the front end computer 50 is located in a data file 113 stored on the front end computer storage device 58. The subscriber account information that resides on the back end computer 52 is located in a data file 114 stored on the back end computer storage device 72.

Specifically with respect to the items of information in a cardholder account, located on the storage device 58 associated with the front end computer 50 is that portion of the subscriber account information 106 that includes the subscriber account number 102, the Internet e-mail address information 104, the state 106, and the currency preference 112. However, the front end computer 50 does not contain any of the pay-in 108 or pay-out 110 information, such as credit card information, etc., associated with any of the subscribers. Credit card or other payment information is located only in the data file 114 on the storage device 72 of back end computer 52

To access the front end program 90 over the Internet, users 14 may use a user interface software program 118 that can be run on their own computers for interactive access, or alternatively, users 14 may access the payment system 90 via conventional e-mail programs, for store-and-forward access. Programs 90 and 118 may be written in any suitable programming language, such as Tcl or C. The software modules are capable of being used with the UNIX operating system, DOS, and may be ported to various other operating systems. Listings of code for the front end program 90 and the user interface program 118 are included at appendices A and B, repectively. A publication entitled “The application/green-commerce MIME Content-type” is included at appendix C and includes a format for Internet communication for use between users of the Internet and the payment system 10.

III. Methods of Operation of the Payment System

As mentioned above, the payment system 10 provides users of the Internet with a variety of services and functions, including making a funds transfer transaction, validating a subscriber\'s status, and enrolling as a subscriber. Several of these services and functions are described below.



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stats Patent Info
Application #
US 20110137751 A1
Publish Date
06/09/2011
Document #
12758711
File Date
04/12/2010
USPTO Class
705 2643
Other USPTO Classes
705 44, 705 2641, 705 261
International Class
/
Drawings
10



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