Systems and methods for selectively delaying financial transactions

Abstract

A risk system that performs a risk assessment of a financial transaction to obtain an initial risk score. Based on the initial risk score, the risk system performs at least one post-score assessment by selectively utilizing various scoring engines and databases. The at least one post-score risk assessment may include delaying the shipment of merchandise in financial transactions that are of marginal risk to thereby provide a check acceptance service with more time to further evaluate the financial transaction risks. Thus, marginally risky financial transactions that are likely to benefit the check acceptance service and a merchant that subscribes to the check acceptance service are authorized for increased profitability and customer satisfaction. Furthermore, the post-score risk assessment may approve or authorize financial transactions that generally fail standard risk assessments that use a cut-off risk score to divide the financial transactions into either approved or declined groups. As a result, the post-score assessment process efficiently re-evaluates some of the borderline exception cases for the purpose of securing beneficial financial transactions.

Description

PRIORITY APPLICATION [0001] This application is a continuation of U.S. application Ser. No. 10 / 041,954, titled “Systems and Methods for Selectively Delaying Financial Transactions”, filed on Jan. 7, 2002, the entirety of which is incorporated herein by reference.BACKGROUND OF THE INVENTION [0002] 1. Field of the Invention [0003] The present invention relates to financial transactions and, in particular, to a system and method of risk assessment, whereby provisional authorization may be granted to a merchant for the selective delay of a financial transaction. [0004] 2. Description of the Related Art [0005] A typical financial transaction involves a form of payment in exchange for vendibles, such as services and / or merchandise, at a point of sale. In most instances, a customer provides the form of payment, such as a promissory check draft, to a merchant in exchange for the vendibles. The check draft is often regarded as a promissory payment that instructs the customer's bank to pay th...

AI Technical Summary

Benefits of technology

[0021] In one aspect, the system may comprise an authorization component that is configured to authorize delivery of the vendibles after the period of time when the additional financial data about the customer indicates that the risk score can be re-positioned in the low classification of risk. The authorization component may further comprise a communications device and contacts the merchant via communications medium and advises the merchant to deliver the vendibles to the customer. The authorization component may be used to authorize the delivery of the vendibles after the period of time unless the merchant is advised to not ship at the end of the period of time by the authorization component. Also, the period of time ranges from at least one micro-second to a few weeks.

Problems solved by technology

As is generally known, the funds promised to the merchant by the check draft are sometimes not paid due to reasons, such as insufficient funds in the customer's checking account or fraud.

Unfortunately, the merchant may be susceptible to risk whenever a check draft is received as payment for services and / or merchandise.

Unfortunately, managing such databases requires use of merchant resources that could otherwise be used more beneficially.

In many cases, marginal risk situations result in lost revenue for the merchant due to the occurrence of borderline or marginal risk assessment declines.

Unfortunately, issuing the high number of risk declines results in customers becoming irate, merchants losing sales, and interferes with the check approving agency's ability to assess marginal risk at higher turndown levels.

Therefore, some conventional check approval agencies are substantially deficient in managing marginal risk and may require significant improvement.

Furthermore, the authorizational processing, temporal risk, and lack of flexibility to manage procedural variations and / or borderline risk scores by conventional check approval agencies may also require significant improvement.

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