Promotional Pricing System with Dynamic Payment Bucket Allocation
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Solution Overview
Problem
Traditional credit account systems lack the ability to offer multiple concurrent promotional APRs, process transactions and payments based on multiple promotional APRs, and allow customer input on payment allocation, which limits card-issuers' promotional offerings and flexibility in managing credit accounts.
Innovation Solution
A system and method for providing promotional pricing that allows for multiple promotional APRs by assigning transactions to specific buckets based on predetermined criteria, allocating payments among default and promotional buckets according to a payment hierarchy, and retroactively adjusting fees and charges.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If traditional two-tier or three-tier credit account configuration is used, then system complexity is reduced, but the ability to offer multiple concurrent promotional APRs is limited
Solution Approach 1:
The patent segments the credit account balance into multiple buckets, where each bucket can have its own APR and promotional terms. This allows the system to offer multiple concurrent promotional APRs by assigning different buckets to different promotional programs, while the underlying system architecture remains manageable through this organizational structure.
Solution Approach 2:
The patent creates a universal bucket structure that can serve multiple promotional programs simultaneously. Each bucket is designed to be flexible and can be configured for different promotional APRs, allowing the same system infrastructure to handle diverse promotional offerings without requiring separate systems for each promotion.
2Ease of operation
If fixed payment arrangement is specified in initial card member agreement, then payment processing is simplified, but customer input on payment allocation is not allowed
Solution Approach 1:
The patent implements dynamic payment allocation where customers can specify how their payments should be distributed across different buckets. The system allows customers to change their payment allocation preferences over time, making the payment structure dynamic rather than fixed, while maintaining automated processing through predefined hierarchies and rules.
Solution Approach 2:
The patent enables customers to self-manage their payment allocations by allowing them to specify which buckets should receive payment first. This self-service capability gives customers control over their payment distribution without requiring manual intervention from the issuer, balancing customer input with automated processing.
3Adaptability or versatility
If traditional credit account system is used, then processing speed is maintained, but ability to retroactively adjust payment allocation or re-calculate fees and charges is lacking
Solution Approach 1:
The patent establishes payment hierarchies and allocation rules in advance, before retroactive adjustments are needed. These predefined structures allow the system to quickly process retroactive adjustments by applying established rules to historical transactions, rather than requiring complex real-time calculations when adjustments are initiated.
Solution Approach 2:
The patent implements feedback mechanisms that track payment allocations and fee calculations across all buckets. This feedback system maintains detailed records that enable efficient retroactive adjustments by providing the necessary data foundation for recalculating fees and re-allocating payments without requiring complete re-processing of historical transactions.
Data Source
AI summary
A system and method for providing promotional pricing is disclosed. One or more pricing offers may be provided to a plurality of credit accounts, wherein the pricing offers may be directed to transactions associated with particular products and/or merchants. It may be determined whether a transaction associated with a credit account qualifies for certain pricing offers based on predetermined criteria. A balance incurred through a transaction may be assigned to a promotional bucket associated with a particular pricing offer if the transaction qualifies for the particular pricing offer, or the balance may be assigned to a default bucket if the transaction does not qualify for any pricing offer, thereby causing a total balance to be distributed among the default bucket and the promotional buckets. Payments associated with the credit account may be allocated to the default bucket and the one or more promotional buckets according to a payment hierarchy.