Online interactive and partner-enhanced credit card

Description

RELATED APPLICATIONS

U.S. application Ser. No. 09/872,447, filed on Jun. 1, 2001, entitled “System and Method for Offering a Financial Product”, is generally related by subject matter to the present application, and is herein incorporated by reference in its entirety. The following pending applications and/or issued patents are also generally related by subject matter to the present application: “System and Method for Pre-Decision Database” (Ser. No. 10/654,091; filed Sep. 4, 2003); “System and Method for Generating Graphical User Interfaces (U.S. Pat. No. 6,867,789; and Ser. No. 10/889,176 filed Jul. 13, 2004): “Method and Apparatus for Generating Segmentation Scorecards” (U.S. Pat. No. 6,202,053); “System and Method for Implementing a Consolidated Application Process” (Ser. No. 09/599,602; filed Jun. 23, 2000); and “System and Method for Establishing or Modifying an Account with User Selectable Terms” (Ser. No. 10/284,394; filed Oct. 31, 2002).

FIELD OF THE INVENTION

The present invention relates to a system which facilitates credit decision during an interactive and partner-enhanced credit card application process.

BACKGROUND OF THE INVENTION

Currently, there are two ways of applying a credit card, i.e., mail-in application and on-line application. Both methods follow a static and one-dimensional questionnaire format. An applicant fills out an application, in either the mail form or the on-line form, which consists of background questions about personal information, demographic profiles, and financial information. The application containing the answers to these questions is then submitted to a credit card issuer. The credit card issuer evaluates both the applicant-supplied information and credit bureau-supplied data about this applicant's credit history by means of an established methodology, and makes a decision about whether to approve, or decline, or further review the application. The relevant teachings could be obtained from the patents issued to Norris in the area of realtime processing of loan applications, including U.S. Pat. Nos. 5,870,721; 5,940,811; and 6,105,007.

However, these conventional credit card application methods have the following limitations. To make a credit decision, they cannot obtain enough information from the credit bureau about an applicant with a limited or even no credit history. Besides, they can not capture credit interests of an applicant (e.g., credit card seeker, or reward driven, or partner affinity) and incorporate this information into the decision process. Furthermore, they cannot reflect risks associated with an applicant from different partners.

Hence, in order to overcome these limitations and optimize the credit decision process, there is a need to establish an on-line interactive and partner-enhanced credit card application system.

SUMMARY OF THE INVENTION

Therefore, an object of the present invention is to build up an on-line interactive and partner-enhanced credit card application system to facilitate a credit decision process.

Another object of the present invention is to optimize a product offer process, e.g., pricing and credit line assignment, by means of capturing unique information about an applicant that cannot be obtained easily in the traditional non-interactive and non-partner-enhanced application.

A further object of the present invention is to improve a credit decision process such as approval rate and account mix.

Yet another object of the present invention is to get new credit card holders including those with a limited or even no credit history.

A still further object of the present invention is to generate new sources of revenue through rewards, and/or discounts. and/or advertisements.

In accordance with an aspect of the present invention, a method of facilitating credit decision in an on-line interactive and partner-enhanced credit card application process serves to utilize partner-supplied data of an applicant during credit decision by a credit card issuer.

In accordance with another aspect of the present invention, a method of facilitating credit decision in an on-line interactive and partner-enhanced credit card application process serves to structure an on-line credit card application interactively with a tree-type series of questions and answers or pop-ups such that the next set of questions are based on the answers given. These questions can also be prompted via other statistical modeling techniques such as but not limited to logistic regression, neural networks, genetic algorithms and other methods yet in place.

In accordance with a further aspect of the present invention, a method of facilitating credit decision in an on-line interactive and partner-enhanced credit card application process serves to offer an appropriate bounty to a partner by the credit card issuer based on the data supplied by the partner and obtained through the interactive questions and answers.

In accordance with a yet another aspect of the present invention, a method of facilitating credit decision during an on-line interactive and partner-enhanced credit card application process serves to enable a credit card issuer to make an optimum offer such as pricing and credit line assignment.

In accordance with a still further aspect of the present invention, a method of facilitating credit decision during an on-line interactive and partner-enhanced credit card application process serves to offer commercial incentives, and utilize the partner-supplied data during a statement process to generate further revenue and ensure cardholder retention.

The above and other objects and features of the present invention will be apparent in the following detailed description of the present invention when read in conjunction with the accompanying drawings.

BRIEF DESCRIPTION OF THE DRAWINGS

In order to facilitate a fuller understanding of the present invention, reference is now made to the accompanying drawings. These drawings should not be construed as limiting the present disclosure, but are intended to be exemplary only.

FIG. 1 is a block diagram illustrating an embodiment of an online interactive and partner-enhanced credit card application system.

FIGS. 2A˜2C are a flowchart showing an online interactive and partner-enhanced credit card application process in accordance with one embodiment of the present invention.

FIGS. 3A˜3B are a diagram illustrating exemplary standard questions and answer choices utilized during an interactive and partner-enhanced credit card application process in accordance with one embodiment of the present invention.

FIG. 4 is a diagram illustrating exemplary components of a customer's background data in accordance with one embodiment of the present invention.

FIGS. 5A˜5C are a diagram illustrating exemplary additional questions and answer choices utilized during an interactive and partner-enhanced credit card application process in accordance with one embodiment of the present invention.

DETAILED DESCRIPTION OF THE INVENTION

FIG. 1 is a block diagram illustrating an embodiment of an online interactive and partner-enhanced credit card application system 100. The online interactive and partner-enhanced credit card application system comprises a credit card issuer 101, partners 102, customers 103, and a credit bureau 104. The credit card issuer could be any institution which can issue a credit card and offer credit card service, e.g., a bank, a financial service company, or an insurance company. The card credit issuer in the context hereafter could represent an entity which utilizes suitable software and hardware to carry out an online interactive and partner-enhanced credit card application process. The credit card issuer's partner could be any business unit which offers online commercial products or services, e.g., an online merchant such as amazon.com. or an airline, or a satellite company such as Direct TV, and which establishes a partnership relation with the credit card issuer including incorporating an interactive credit card application as one of its offered products and services, and providing history data between the partner and the applicant to the credit card issuer, e.g., the amounts of purchases, frequency of purchase, and types of purchase. The customer could be any person who can utilize internet access to make a product or service purchase by means of an internet-accessible computer. A credit bureau could be any institution which can provide credit history information of a credit card applicant, e.g., FICO score. The credit card issuer and its partners have facilities which comprise suitable hardware and software such as communication interfaces, processors, storage devices, and database configured for the online interactive and partner-enhanced credit card application. The credit card issuer could communicate with its partners and the credit bureau using a specific network system. They may also communicate with each other through a non-system avenue, such as a third party network.

It should be understood that the specific hardware and software used in the online interactive and partner-enhanced credit card application system is not critical to the present invention, and one of ordinary skills in the art will readily appreciate variations in hardware and software configurations that are suitable.

FIGS. 2A˜2C are a flowchart showing an online interactive and partner-enhanced credit card application process in accordance with one embodiment of the present invention. When a customer finishes a transaction of making an online product or service purchase from a partner of a credit card issuer 200, a pop-up appears on the screen to ask whether the customer is interested in applying a credit card offered by this credit card issuer 201. This purchase can also be made through other mediums such as but not limited to POS terminals, Kiosks. Cell Phones, Pocket PC's, RFID, and future mediums in development. If the customer clicks yes, an interactive credit card application process is initiated 202. If the customer clicks no, the credit card application process is stopped 203. The customer could then either end the online session or continue to use other services on the partner's website/medium. According to another approach, the credit card application is one of the services offered by the partner of the credit card issuer 204. The customer could directly access this service at any time, or before/after making a product or service purchase 205.

When an online interactive and partner-enhanced credit card application process is initiated, the partner retrieves data about the customer from its own database including, preferably but not limited to, background data (e.g., personal information, demographic profiles, and financial information), past transaction data (e.g., amounts of purchases, frequency of purchases, and types of purchases), and/or other data (e.g., credit accounts used), and transmits these data to the credit card issuer 206. In the meantime, a real-time online session is established between the customer and the credit card issuer by means of suitable software, hardware, and interne connection. The credit card issuer utilizes interactive questions and answers to obtain the customer's background, and/or standard, and/or additional information 207.

The interactive question and answer form is a dynamic process with a tree-type series of questions/answers or pop-ups such that the next set of questions are based on the answer given. FIGS. 3A˜3B are a diagram illustrating exemplary standard questions and answers utilized during an interactive and partner-enhanced credit card application process in accordance with one embodiment of the present invention. The method of FIG. 2A is described in connection with FIGS. 3A˜3B in order to set forth the method in a concrete fashion easily understood by the person of ordinary skills. However, this articulation of the method is exemplary only, and the method could be implemented using questions different from those of FIGS. 3A˜3B.

As set forth in step 208 of FIG. 2A, a pop-up asks the customer: “How long have you had your first credit card?” The credit card issuer uses this trigger question to determine if additional questions are needed based on the answer from the customer. If the selection the customer picks up is: “36 or more months”, the credit card issuer will check whether the customer's background data from the partner is complete 209. If yes, the credit card issuer will use interactive questions and answers to ask the customer his/her background information, compare the partner-supplied data with the customer-supplied data, and thus validate the customer's background information 210. If the customer's background data from the partner is not complete, a pop-up will appear to ask the customer to provide the background data 211.

FIG. 4 is a diagram illustrating a customer's exemplary background questions in accordance with one embodiment of the present invention. The method of FIG. 2A is described in connection with FIG. 4 in order to set forth the method in a concrete fashion easily understood by the person of ordinary skills. However, this articulation of the method is exemplary only, and the method could be implemented using questions different from those of FIG. 4. The background data consists of, preferably but not limited to, personal information, demographic profiles, and financial information.

As set forth in step 212 of FIG. 2A, the customer answers the background questions and sends the answers back to the credit card issuer. When the background data is complete, the credit card issuer inquiries credit history data about this customer from the credit bureau 213. The credit bureau retrieves the credit history data about this customer from its database and transmits them to the credit card issuer 214. The credit card issuer evaluates the background data and the credit bureau data 215, and decides whether the customer is qualified for the credit card offer based on an established methodology 216. The qualification based upon applicant bureau data can also occur prior to or post the applicant providing answers to the methodology described herein using additional partner, product, or other traditional/non-traditional data sources.

As set forth in step 208, if the customer picks up the choice “Never had a credit card” or “less than 24 months” or “24˜36 months”, the credit card issuer will check whether the customer's background data from the partner is complete 217. If yes, the credit card issuer will use interactive questions and answers to ask the customer his/her background information, compare the partner-supplied data with the customer-supplied data, and thus validate the customer's background information 210. If the customer's background data from the partner is not complete, a pop-up will appear to ask the customer to provide the background data 218. The customer answers the background questions and sends the answers back to the credit card issuer 219. When the background data is complete, the credit card issuer inquiries credit history data about this customer from the credit bureau 220. The credit bureau retrieves the credit history data about this customer from its database and transmits them to the credit card issuer or third party vendor used for decision 221. The credit card issuer and/or vendor evaluates the background data and the credit bureau data 222, and decides which category the customer belongs to, i.e., either a customer with enough credit history data or a customer with limited or even no credit history data 223. If the customer belongs to one with enough credit history data, the credit card issuer decides whether the customer is qualified for the credit card offer based on the established methodology and the credit history data 216.

If the credit card issuer decides that the customer is qualified for the credit card offer, the credit card application is approved 224. If the credit card issuer decides that the customer is not qualified for the credit card offer, the qualification for the credit card offer will be considered together with the customer category with limited or even no credit history data.

For a customer with limited or even no credit history data, the credit card issuer will take into account the data supplied by the partner which could be his past transaction data with the partner (e.g., amounts of purchases, frequency of purchases, and types of purchases), and/or other data (e.g., credit accounts used), when he decides whether the customer is qualified for the credit card offer based on an established methodology which includes the partner-supplied data 225. If the customer is qualified for the credit card offer after considering the partner-supplied data, his credit card application will be approved 224. If the customer is still not qualified for the credit card offer after considering the partner-supplied data, the credit card issuer will interactively ask standard questions to obtain some important information about the customer 226. The exemplary standard questions are listed in FIG. 3A. As an example, the credit card issuer may ask: “What is the status of your employment?” As another example, “What is your average monthly savings in the past 12 months?” FIG. 3B lists additional standard questions which could be asked at this time.

During the interactive questions and answers, the partner-supplied data can be used as “truth serum” to detect whether the consumer is being truthful in his/her answers. For example, if the partner indicates that this customer has made past purchases on nine separate credit accounts but the customer selects “less than three”, the issuer can deduce this customer is not being truthful, which will be included in the credit decision methodology.

As set forth in step 227, based on the answers given together with the background data and the credit history data, the credit card issuer will decides whether the customer is qualified for the credit card offer. If yes, the credit card application is approved 224. If not, the credit card issuer will ask additional questions about the experience with the partner to probe the customer's credit interests to make credit decision 228. The process may ask additional questions on approved accounts already on the approval path to determine for which future promotions the cardholder should be offered.

As set forth in step 224, for the customer whose credit card application is approved, the credit card issuer will ask additional questions about the experience with the partner to probe the customer's credit interests so that the credit card issuer could make an optimal product offer to the customer 229. The optimal product offer may include various incentives that might be given to the customer to induce acceptance. For example, it might include an offer for six months 0% balance transfers, frequent flyer miles, or other points/rewards/rebates. As another example, the customer may be given an incentive of $15 off Stephen King's latest novel if he/she signs up for the new account.

The exemplary additional questions are listed in FIGS. 5A˜5C in accordance with one embodiment of the present invention. The method of FIG. 2C is described in connection with FIGS. 5A˜5C in order to set forth the method in a concrete fashion easily understood by the person of ordinary skills. However, this articulation of the method is exemplary only, and the method could be implemented using questions different from those of FIGS. 5A˜5C. FIG. 5A, FIG. 5B, and FIG. 5C show examples with Amazon.com, Disney, and Continental as a hypothetical partner of the credit card issuer respectively, the listed questions could be ones that the credit card issur may ask as additional questions.

Based on the answers given from the additional questions, the credit card issuer will decide whether the customer is qualified for the credit card offer based on the established methodology which takes into account the background data, the credit history data, the data from standard questions, and the data from additional questions 230. If yes, the credit application is approved 231. If not, the credit card application is declined 232.

The final step is to notify the customer the approval decision with the optimized product offer 233 or the decline decision 234. Further, if the approved customer is an existing cardholder of another credit card account, a pop-up may appear stating: “We note that you already have a credit account with us.” Then the pop-up could ask the customer whether he/she wishes to (a) increase the limit on the old card; (b) transfer the balance on the old card onto the new card; and (c) accept a product more suited given the applicant input provided.

According to one approach, the above description could be a real-time interactive and partner-enhanced credit card application process. According to another approach, this interactive and partner-enhanced credit card application process could be one without a real-time link to the credit card issuer, i.e., the decision tree question/answer logic is predetermined. Again, the term decision tree should not limit the type of predictive modeling techniques used for question selection and presentation.

This online interactive and partner-enhanced credit card application process could relate the partner-supplied data and the data obtained through the interactive questions and answers to a bounty that a credit card issuer pays to a partner. A bounty is what the credit card issuer pays to the partner when a new credit account results from an on-line application. The bounty can be adjusted according to the value proposition of the customer at the time of offer, whether the customer is already a cardholder with the credit card issuer on another account (lower bounty in that case), and so forth. Using partner-supplied data can allow a more efficient determination of appropriate bounty, i.e., not just based on credit score. Additionally, if the credit card issuer determines that the partner-supplied data is not improving the credit decision, the credit card issuer can reduce the bounty paid to the partner. This will motivate the partner to provide better data, and thus benefit the credit issuer to make better decisions.

This online interactive and partner-enhanced credit card application process could also use the partner-supplied data or the data through interactive questions and answers to generate further revenue and ensure cardholder retention. Account rewards could be tailored to the customer's interests and purchase habits. For example, if Direct TV indicates that the customer watches a lot of HBO boxing, the credit account statement could include rewards/discounts for ShowTime boxing events. The credit card issuer could charge merchants and service providers for advertising their products/services through the credit card statement process. That advertising could be targeted based on the customer's habits as reflected based on the partner-supplied data or the data from the interactive questions and answers. The communication of promotions via statement should be used as an example to include all mediums in current and future use to which the cardholder has access to the statement or payment inquiry function.

During the online interactive and partner-enhanced card application process, the partner could also use the financial services data to help make better decisions on what products and services to offer the customer. The credit card issuer may indicate that the customer is a heavy telecom user, and the airline could offer some special promotions on telecom equipment and services at the customer's destination (e.g., calling cards, wireless internet connectivity). As an example, a partner makes a credit card offer to a customer. From the partner data, the credit card issuer identifies that the customer is already its credit card holder. The credit card issuer offers the customer to change his previous card to the current card or have multiple cards. In this case, the partner's bounty is not as big since the customer is already a card holder. Since the customer is already a card holder, the credit card issuer has the customer's profile on his buying habits, for instance the credit card issuer may know that the customer is an avid golfer and likes fine dining. The partner is advised of these preferences so that he can offer a product selection based on this additional knowledge. As another example, a credit card issuer offers a credit card to a new customer. Using the partner-supplied data, the credit card issuer arguments the application process. Based on the credit decision, the credit card issuer advises the partner on possible upgrades to the services or products that could be offered to the customer.

Although the present invention is exemplified in terms of computer-aided online credit card application, the present invention could also be applied by means of other media such as cell phone and e-book.

Although an illustrative embodiment of the present invention, and various modifications thereof, have been described in detail herein with reference to the accompanying drawings, it is to be understood that the invention is not limited to this precise embodiment and the described modifications, and that various changes and further modifications may be effected therein by one skilled in the art without departing from the scope or spirit of the invention as defined in the appended claims.