Dynamic bin allocation for payment card transactions
Preauthorized payments may be made to service providers, repair shops and even vendors serving employees on business trips through credit card processing. The approved payment amount is authorized on a virtually created payment card which is then sent to the payee. These transactions incur interchange fees for the card processing. Therefore, unlike a check or EFT payment, the payee receives the approved payment less interchange fees. Interchange rates vary based on the payment card product offered by an issuing bank in addition to factors relating to how the payment card is processed. The current invention is a method of automatically generating a virtual payment card and/or processing the card in a manner to achieve a target interchange fee.
1. A computer implemented method for virtual card payment, the method comprising:
electronically receiving on a computing device an authorized amount value from a payor to pay a designated payee;
retrieving from an electronic storage device a target interchange rate for payment to the designated payee;
automatically selecting a bank identification number account from an issuer bank, the bank identification number account having an effective interchange rate based on the inclusion or exclusion of interchange factors selected from the group consisting of card not present, enhanced data, debit personal identification number, address verification service, security code and delayed settlement;
electronically generating a virtual payment card with the selected bank identification number account wherein the effective bank identification number interchange rate adjusted in accordance with the target interchange rate by the inclusion or exclusion of the interchange factors; and
authorizing the virtual payment card to the authorized amount value whereby processing of the virtual payment card for the authorized amount on behalf of the designated payee incurs the effective interchange rate.
2. The method of claim 1 wherein the virtual payment card is electronically transmitted directly to a card acquirer for the designated payee for processing.
3. The method of claim 2 further comprising the steps of:
receiving remittance advice related to the claim charges incurred by the designated payee, the remittance advice indicating which activities are payable under a claims policy; and
transmitting the remittance advice to the designated payee with a confirmation that payment has already been made on its behalf directly to the card acquirer.
4. The method of claim 1 wherein the target interchange rate is based on the authorized amount value.
5. The method of claim 1 wherein the target interchange rate is based on the payment history to the designated payee.
6. The method of claim 1 wherein the target interchange rate is based on the preference of an entity selected from the group consisting of a third party administrator, a carrier for the claims policy, and the designated payee.
7. A computer implemented method for virtual card payment, the method comprising:
electronically receiving on a computing device an authorized amount value from a payor to pay a designated payee;
retrieving from an electronic storage device a target interchange rate for payment to the designated payee;
accessing a plurality of bank identification number accounts at one or more issuer banks, each account having a predefined interchange rate;
automatically selecting a single bank identification number account from the plurality of bank identification number accounts, the single bank identification number account's interchange rate in accordance to the target interchange rate;
generating a virtual payment card with the selected, single bank identification number account and authorizing it to the authorized amount value; and
sending the virtual payment card to the designated payee in payment of the authorized amount.
8. The method of claim 7 wherein the target interchange rate is based on the authorized amount value.
9. The method of claim 7 wherein the target interchange rate is based on the payment history to the designated payee.
10. The method of claim 7 wherein the target interchange rate is based on the preference of an entity selected from the group consisting of a third party administrator, a carrier for the claims policy, and the designated payee.
11. A computer implemented method for virtual card payment, the method comprising:
electronically receiving on a computing device remittance advice related to charges incurred by a designated payee, the remittance advice generated by a third party administrator that determines which activities are payable under an claims policy;
retrieving from an electronic storage device an authorized amount value from the third party administrator to pay at least a portion of the charges associated with the remittance advice;
setting a target interchange rate for the payment to the designated payee;
automatically selecting a bank identification number account from an issuer bank, the bank identification number account having an effective interchange rate based on the inclusion or exclusion of interchange factors selected from the group consisting of card not present, enhanced data, debit personal identification number, address verification service, security code and delayed settlement;
electronically generating a virtual payment card with the selected, single bank identification number account wherein the effective bank identification number interchange rate is set closest to the target interchange rate by the inclusion or exclusion of the interchange factors; and
authorizing the virtual payment card to the authorized amount value whereby processing of the virtual payment card for the authorized amount on behalf of the designated payee incurs the effective interchange rate; and
electronically transmitting the virtual payment card data to a card acquirer for processing the authorized amount.
12. The method of claim 11 wherein the target interchange rate is based on the authorized amount value.
13. The method of claim 11 wherein the target interchange rate is based on the payment history to the designated payee.
14. The method of claim 11 wherein the target interchange rate is based on the preference of an entity selected from the group consisting of a third party administrator, a carrier for the claims policy, and the designated payee.