Automated Referral System for Declined Small Business Financing

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Solution Overview

Problem

Small businesses face significant challenges in managing financial and transactional tasks due to resource constraints, including obtaining financing, managing commercial transactions, and maintaining relationships with customers, which are often inefficient and labor-intensive, and traditional referral models fail to effectively recoup sunk costs and maintain relationships with declined customers.

Innovation Solution

A transaction management and financial services system that communicates via a network, allowing for the receipt and storage of referrals from referring parties, providing automated solutions for financing, trade credit underwriting, and commercial transaction management, enabling real-time access to transaction information and customized services, and facilitating alternative credit offers to small businesses.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Productivity

If small businesses use traditional tools and manual processes to manage financial and transactional tasks, then they can maintain operational control, but resource consumption and time requirements increase significantly

Engineering Contradiction:

Improvetransaction processing efficiencyVSAvoidtime for administrative tasks

Core Design Contradiction:

ProductivityVSLoss of time

Solution Approach 1:

The patent replaces manual mechanical processes (phone calls, faxes, mail, paper-based documentation) with automated electronic systems. The transaction management system automates credit evaluations, document exchanges, payment processing, and communication between buyers, sellers, and financial institutions, eliminating the need for labor-intensive administrative tasks while maintaining operational control.

Inventive Principle:

Principle #28Mechanics substitution (Replace mechanical system)

Solution Approach 2:

The patent introduces an intermediary transaction management system that facilitates interactions between small businesses and financial institutions. This intermediary platform streamlines the referral process, automates credit assessments, and coordinates transaction documentation, reducing the time and resources small businesses must dedicate to these processes while improving overall transaction efficiency.

Inventive Principle:

Principle #24Intermediary (Mediator)

2Loss of energy

If financial institutions refer declined small businesses to alternative lenders, then they can recoup some value from sunk costs, but they lose direct access and brand exposure to these customers

Engineering Contradiction:

Improvesunk cost recoveryVSAvoidcustomer access and brand exposure

Core Design Contradiction:

Loss of energyVSLoss of information

Solution Approach 1:

The patent implements a feedback mechanism where the transaction management system tracks and reports customer interactions, credit evaluation results, and referral outcomes back to the referring financial institution. This allows the institution to maintain visibility into customer data and referral effectiveness, enabling them to recoup value through performance-based compensation while retaining strategic customer insights.

Inventive Principle:

Principle #23Feedback

Solution Approach 2:

The patent creates a universal transaction management platform that serves multiple functions: it acts as a referral management system, credit evaluation engine, transaction processing hub, and communication platform. This multi-functional system enables financial institutions to maintain customer relationships and brand exposure while efficiently referring declined customers to alternative lenders through a centralized, trackable process.

Inventive Principle:

Principle #6Universality (Multi-functionality)

3Productivity

If small businesses implement e-commerce solutions and automated systems, then they can improve transaction efficiency and reduce manual labor, but the capital investment and resource requirements increase

Engineering Contradiction:

Improveautomated transaction managementVSAvoidtechnological infrastructure requirements

Core Design Contradiction:

ProductivityVSDevice complexity

Solution Approach 1:

The patent merges multiple separate functions (credit evaluation, transaction management, document exchange, payment processing, and communication) into a single integrated transaction management platform. This consolidation reduces the technological infrastructure small businesses must independently maintain, as they gain access to enterprise-grade automated systems through the unified platform without bearing the full capital cost of developing and maintaining each separate system.

Inventive Principle:

Principle #5Merging (Combining)

Data Source

PatentUS7769649B1System for and method of handling referrals from referring parties

Publication Date: 2010.08.03 LSQ FUNDING GRP L C

AI summary

A method in a transaction management and financial services system configured to communicate between a server and at least one remote device via a network is described. The method can include the steps of receiving a referral from a referring party where the referral including information regarding any one of a financing-seeking party that has been declined by the referring party and a transaction management-seeking party; and storing the information regarding the referral in a storage device. Other methods performed by the integrated financial and transaction management services system are also described.