AU2012247022A1 - Automated budget management, multiple payment, and payment authority management - Google Patents

Abstract

Abstract The invention is directed towards methods and systems for managing direct debit authorities, including means for transferring a direct debit authority from an old financial institution to a new financial institution. The methods and systems include steps for: receiving a request to change at least one financial account from an old financial institution to a new financial institution; receiving at least one direct debit authority associated with the old financial institution ; providing the new financial institution the at least one direct debit authority; sending a transmission to at least one biller that relate to the at least direct debit authority, regarding the change of financial institution, such that the at least one biller can draw funds from the new financial institution based on the direct debit authority

Description

AUSTRALIA Patents Act 1990 COMPLETE SPECIFICATION Standard Patent Applicant(s): Controlabill Pty Ltd Invention Title: AUTOMATED BUDGET MANAGEMENT, MULTIPLE PAYMENT, AND PAYMENT AUTHORITY MANAGEMENT The following statement is a full description of this invention, including the best method for performing it known to me/us: - 2 AUTOMATED BUDGET MANAGEMENT, MULTIPLE PAYMENT, AND PAYMENT AUTHORITY MANAGEMENT Field of the Invention 5 This invention relates to automated budget management, multiple payment, and payment authority management, and relates particularly but not exclusively to such operating via an electronic communication medium 10 where there will be management of aggregated authorities for payment of bills. Cross Reference to Related Applications 15 This application is based on and claims the benefit of the filing date of US application Serial No. 60/794,286 filed 21 April 2006 the contents of which are incorporated herein by reference in its entirety. 20 Background Art Hitherto, there have been many proposals for automatic payment of bills. The bills can come from many billers, for example, leasing companies, housing loan 25 institutions, public essential services organisations, such as, power organisations, gas organisations, sewage organisations, water organisations, and the like. Other bills are encountered such as payment of vehicle registration fees, vehicle insurance, and the like. The 30 bills may be to individuals or to companies or organisations. Sometimes actual bills are not received, but a payment of a prior financial expense is required. Throughout this specification and the claims the terms - 3 "bill or bills" are to embrace such expense and the need for payment. Direct debit processing is one known option to attempt to automate a bill payment process. Another 5 solution is to allow direct debiting to a credit card facility. In each case however, the recipient of a bill, needs to set-up an arrangement for the automatic payment. This means, that the recipient of the bill must undertake a registration process for each of the biller's concerned. 10 For example, if an electricity bill is to be paid by an automatic payment process, the biller may offer an automatic payment process to the customer. This requires the customer to then request participation in the direct debit process. The biller then sends a suitable form to 15 the customer which must be completed and returned to the biller. The Biller must then manually process information from the form and then store the form in perpetuity to prove the validity of the authority to the Bank in case it is ever disputed. In the case where such direct 20 debit/payment is authorised, and insufficient funds are available to make the payment, then the bank or other financial institution is required to report the non-payment to both the biller and the recipient of the bill. Notification by the Bank to the biller is by way of 25 an electronic file. Notification to the customer is by way of a bank statement. This is done by way of traditional mail and is a burden for the billers and banks or other financial institutions. The Biller is also required to send a reminder statement by traditional mail to pursue 30 payment and may require another payment channel to be used. In the case where a recipient of the bill elects to make a payment of a bill using a service such as B-Pay - 4 (Registered Trade Mark), the recipient needs to become involved in every payment by accessing the B-Pay service and arranging for payment of each bill. Other forms of payment such as Internet banking, cheques, credit cards, 5 National Posts, and payments direct to billers all require the recipient of the bill to be actively involved in the payment process for each and every bill. Except for fixed amount bills, none of these payment methods allow for the automation in respect of a variable amount and/or a 10 variable timing of bills. Object and Statements of Invention There is a need for an improved system and methods to 15 minimise the need for individuals to intervene during bill payment processes (but still retain control). In accordance with a first aspect, the present invention provides a method of managing direct debit authorities comprising the steps of: 20 receiving a request to change at least one financial account from an old financial institution to a new financial institution; receiving at least one direct debit authority associated with the old financial institution ; 25 providing the new financial institution the at least one direct debit authority; sending a transmission to at least one biller that relate to the at least direct debit authority, regarding the change of financial institution, such that the at 30 least one biller can draw funds from the new financial institution based on the at least direct debit authority.

-5 In accordance with a second aspect, the present invention provides a method for managing direct debit authorities comprising the steps of: receiving information regarding creation of a new 5 financial account at a new financial institution from the customer; receiving at least one direct debit authority that needs to be switched to the new financial institution from the customer; 10 switching the at least one direct debit authority to the new financial institution providing the at least one direct debit authority to the new financial institution; sending a transmission to at least one biller that 15 relate to the at least direct debit authority, regarding the change of financial institution, such that the at least one biller can draw funds from the new financial institution based on the at least direct debit authority. In accordance with a third aspect, the present 20 invention provides a direct debit authority management system comprising: a customer interface arranged to receive customer information, the customer interface further arranged to enable a customer to input an instruction to create a 25 direct debit authority; a processor arranged to create and establish a direct debit authority for at least one biller in response to the customer input, the direct debit authority being based on at least the customer information received via the 30 customer interface; a storage repository arranged to store the customer information received by the interface and store the created at least one direct debit authority; and - 6 wherein the processor being arranged to provide the direct debit authority to the biller, the direct debit authority linking the customer with the biller, such that a biller can withdraw funds from a customer based on the 5 established direct debit authority. In accordance with a fourth aspect, the present invention provides a computer based method for managing direct debit authorities comprising the steps of: receiving instructions from a customer to create or 10 modify at least one direct debit authority relating to at least one biller; creating and storing the at least one direct debit authority; providing the at least one direct debit authority to 15 the at least one biller to link the customer to the at least one biller, enabling the at least one biller to draw funds from a customers' financial account based on the created direct debit authority. 20 Brief Description of Drawings In order that the invention can be more clearly ascertained, reference will now be made to known prior methods, and then to examples of embodiments of the 25 invention wherein: Figure 1 is a schematic diagram showing a prior system for bill payment; Figure 2 is an overview diagram showing process steps in the system shown in Figure 1; 30 Figure 3 is a diagram similar to that in Figure 1 showing an example of an embodiment of the present invention; - 7 Figure 4 is a block architectural schematic view of a system in accordance with one preferred example of the present invention; Figure 5 is an overview diagram showing concepts 5 utilised in the examples of Figure 3 and Figure 4; Figure 6 is a high level overview diagram showing basic steps within the system example of Figures 3 through 5; Figures 7 (a) and 7 (b) show method steps for budget 10 setting used in the example of Figures 3 through 6; and Figure 8 shows method steps performed by a biller in the example of Figures 3 through 7 (a) and 7 (b). Detailed Description of Preferred Embodiments 15 Referring firstly to Figure 1 there is shown an overview of a prior art direct debit system involving multiple billers. Here, a single customer is shown but in practice, there will be many customers dealing with many 20 different billers. Only one bank is shown but there may be multiple banks or like financial bodies. Customers will hereinafter be referred to as "customer" and banks and financial bodies as "banks". In addition, each of the billers will be referred to hereinafter as billers. 25 Figure 1 shows that a customer 1 may be required to deal with multiple billers 3. The multiple billers 3 may be any person or organisation that will bill a customer 1. These billers may comprise, as an example, government service utility organisations such as power supply companies, gas 30 supply companies, water supply.companies, sewage supply companies, councils etc. The billers 3 may comprise any other billers that may render accounts to the customers 1. Here, the billers 3 can invite the customer 1 to - 8 participate in a direct debit payment scheme. In this case, the customers 1 must complete a direct debit authority form for each of the billers 3, and nominate a particular bank 5 from which customer funds can be drawn 5 upon to pay the particular bills. As can be appreciated, the customer 1 deals with each biller 3 and is required to complete separate direct debit authority forms for each biller 3. While the requirements of the direct debit system are common, each biller has a different process and 10 its own form which can make it difficult for the Customer. Typically, the customer 1 has a bank account at bank 5 from which funds for bill payment can be taken. The customer 1 may have bank accounts at multiple banks 5 and when completing the direct debit authority process, the 15 customer 1 may nominate the particular bank 5 and the particular bank account concerned. The process of completing a direct debit authority can be relatively complex for a customer 1 and must be repeated for each biller. 20 Figure 2, outlines 17 steps that are required in some direct debit authority processing. The 17 steps are not exhaustive as some particular direct debit processes may involve fewer or greater numbers of steps, The example shown in Figure 2 is for illustrative purposes. At step 1, 25 it can be seen that, the biller invites a customer 1 to participate in a direct debit service. At step 2, the biller 3 provides a biller' s direct debit form to the customer 1. At step 3, the customer 1 completes the form, and at step 4 sends that form to the biller 3. At step 5, 30 the biller processes the form, and at step 6 updates a direct debit file. At step 7, the biller 3 files a paper authorisation in the biller' s record 3. At step 8, the biller 3 sends an invoice to the customer 1. At step 9 - 9 (not shown) a period such as a 2 weeks period or other duration period is allowed before the bill is paid. At step 10, the biller 3 sends a direct debit file of many customers' bills to the billers' bank 7. At step 11, the 5 biller' s bank 7 splits the direct debit file into batches for individual customers' banks. At step 12, the biller' s bank 7 sends electronic debit files to each of the customer banks 5 in accordance with known interbank protocols. At step 13, the customer's bank 5 responds with 10 an electronic payment, and provides electronic advice to the biller' s bank 7 of payment, rejection of payment, and possible reason for rejection. At step 14, the biller' s bank 7 advises the biller 3 of payment outcomes. At step 15, the biller follows up any rejected payments with the 15 customer 1. At step 16, the payment process commences again at step 10. At step 17, the customer's bank 5 forwards an account statement to the customer 1. It should be appreciated that this process occurs with each biller. 20 Figure 3, is a view similar to that of Figure 1 but showing an example of a preferred embodiment of the present invention. Here, a customer 1 deals with a customer's bank 5 in order to register in the automated system. Each of the billers 3 is required to be registered 25 in the system by the registering of details with the biller's bank 5. Accordingly, in the example shown in Figure 3, a customer deals directly with the bank rather than with the biller during a registration process. Thus, in the example, the customer registers multiple billers 30 through a single process with the customer's bank 5 only once. This can be contrasted with the example in Figure 1, where the customer 1 registers with each Biller and the Bank is not directly involved in the registration process.

- 10 In the example of Figure 3, a biller 3 is required to have a particular bill "pay into" account either at the customer's bank 5 or a biller's 3 dedicated bank account at another bank (not shown in Figure 3), In the example, 5 the customer 1 is required to commit to make regular committed customer payments to the bank 5 to cover the cost of bills which will be rendered to the customer 1 by all the billers' 3, so as to provide budgeted funds for bill payment. The committed customer payment is based on a 10 budget setting process involving all of the anticipated bills from all chosen billers over a period of time (such as 12 months) before the customer is registered in the system. The process therefore establishes bill payment authorities, for the payment of bills from the chosen 15 billers. The system then manages those authorities. The system of Figure 3 requires that the billers 3 forward electronic and/or paper bill details to both the customer 1 and the customer's bank 5. A suitable period such as 2-3 weeks will be allowed prior to the bank making 20 a payment to the billers 3 bill payment account. It can therefore be seen that, with the example, when a customer 1 is registered in the system, the customer 1 must commit to make regular committed customer payments to the bank 5 for the bills to be rendered to the customer 1 by the 25 billers 3. The quantum will generally be equal or greater than the budgeted funds or it may, in some circumstances be less than the budgeted funds, as will be explained hereinafter. In one scenario the customer may have his/her whole salary deposited into the bank account, and be able 30 to draw from the account for day to day matters provided that at a given time there will always be a minimum amount in the account to pay the expected bills in the budget. The regular committed payment made by the customer is - 11 based on a budget setting process involving all of the anticipated bills from all the billers over a period of time (such as 12 months) before registration of the customer 1 can be completed. Thus, in the example shown, 5 there should theoretically be sufficient funds at the bank 5. During the 2-3 week period, given as an example above, after which funds for payment of the biller' s bill is automatically electronically drawn from the customer's bank 5, the customer 1 may have the facility to suspend an 10 automatic payment via a process to suspend a particular authority, such as if there is a dispute. In this way, the customer 1 will contact the bank 5 and modify their authority so as to stop any further payments to a disputed biller. If a dispute is raised, then the biller is not 15 paid by the system until the payment authority is reinstated. Various scenarios may be implemented as to the way in which a dispute may be raised. This will be explained more fully in due course. Further, if the customer 1 has not made sufficient funds available to the 20 bank 5, because of timing issues relative to the regular customer payments to the bank 5 to meet budget over the particular period (such as 12 months), then the bank 5 may have an overdraft facility which can be used, and appropriately charged to the customer 1. Depending on the 25 bank, the bank account may have a line of credit available, and in one case this could be based on the bank holding an asset of the customer, such as a mortgage loan on an asset such as a house. In such case there could be equity in the asset, and the effect might be that bills 30 are paid against funds contingent on an equity level agreed by the bank. In this way if funds are not deposited regularly by the customer, or there is a shortfall, the bills can nevertheless be paid by the bank by using the - 12 customer's equity in the asset. Appropriate interest may be levied against any such equity component involved in bill payment. In another example, the bank may set up a credit card account from which to pay bills rendered by 5 the billers, and interest charged to the customer if appropriate. It should be appreciated that with the above system, there is substantially greater certainty provided to billers of payment of bills than with the prior system 10 disclosed in Figure 1 where the customer 1 does not commit to have made sufficient funds in the bank 5 to enable the bills to be paid. Thus, in the example of Figure 1, there is no budget setting process involved when a direct debit system is commenced. The responsibility for making funds 15 available lies directly with the customer 1 itself. In the system shown in Figure 3, the customer 1 registration process requires committed regular customer payments to the bank 5 to cover the cost of bills to be rendered to the customer 1 by the billers 3, based on a budget setting 20 process involving all of the anticipated bills from all chosen billers over a period of time. Thus, with the example shown in Figure 3, billers 3 will have greater confidence in participating than with the prior art direct debit system shown in the example of Figure 1. In the case 25 where the bank can take funds from equity in the customer's asset, the biller has greater confidence than with the prior art systems, as the biller will know that the bank will pay the bills. In such scenario, the biller will not know that the bill payments involve customer's 30 equity. Referring now to Figure 4, there is shown an overview system architecture diagram using a communication medium to permit electronic communication between customers 1, - 13 billers 3, customer banks 5 and biller banks 7. The communication medium can be the Internet or other forms of communication such as dedicated data lines, telephone lines, and other communication mediums known for 5 transmitting data between entities. In the example shown in Figure 4, a system 9 is shown that hosts basic functions of operation. The system 9 may have a website address in the Internet which can be accessed by customers 1, or alternatively, the customers 1 may enter a bank 10 website and be directed through to the system 9 in a transparent way to the customer. In this way, the customers 1 can access their customer banks 5 through the normal portal and be internally directed through to the system 9. Alternatively, the system 9 may be resident 15 wholly at each of the customer's banks 5. Figure 4 shows that the customers 1 can be infinite from one customer through to N customers. Similarly, the billers 3 may be multiple billers through to biller N. Each of the customers 1, and billers 3, has a communications device 20 such as a PC or central computer system or mobile phone that can connect with the system 9 through communication service providers 11. Communication between customer banks 5 and biller banks 7, for transferring sensitive banking data can be via known dedicated secure communication 25 links, and can be independent of the Internet or other communication medium and can use known bank specific protocols. Figure 4 shows that the system 9 has a subset of systems for customer registration 13, biller registration 30 15, archive/audit log 17, and a data warehouse 19. Figure 4, also shows that the customers banks 5 have access to individual customer accounts 21. Figure 4 also - 14 shows that the biller banks 7 have access to individual biller accounts 23. Referring now to Figure 5, there is shown a functional overview diagram of processes involved in 5 budget setting. This process is performed in an automated way through dedicated software. This software may be integral with the system 9 or independent and may be via a third party service provider. In the case where the software is 10 provided by a third party service provider, a suitable communication link can be made to the third party service provider from the system 9 so that a customer 1 does not see the system in a fragmented way, but as a total system package. The budget setting process requires that all the 15 anticipated bills from billers be itemised and the quantum of the bills estimated. Figure 5 shows a number of potential bills from respective billers being home loan, insurances, electricity etc, through to savings and investments. It shows a total bill payment of $3,500 per 20 month. Typically, the budget setting process is over a period of time such as 12 months. This is shown as step 25. Typically, the budget setting process is performed electronically over the Internet but may be by other communication means such as by phone, by data entry at a 25 bank branch, or by data entry at an accountant's office or any other similar data entry arrangement. This budget setting process differs from traditional bank budget forms by actually capturing the specific provider of each service and the customer's account number with each 30 provider. Figure 5 shows that the customer's salary and other income is normally deposited to a particular everyday account 27. The budget setting process 25 requires that $3,500 per month be deposited to a special - 15 bill payment account 29. In some situations multiple bank accounts may be involved. Such an arrangement for multiple accounts can be at the discretion of the particular customer's bank. Figure 5 shows that the payment to the 5 special bill payment account 29 may be at periods other than monthly such as fortnightly. Figure 5 also shows that the everyday account 27 can be accessed by phone banking 31, ATM banking 33, point of sale banking 35, bank branch accessing 37, and Internet banking 39. 10 The bank 5 makes bill payments to the biller' s bank accounts from the special bill payment account 29 after a period of time following the forwarding' of bill details to both the customer and the bank. The bill payment account 29 can be reviewed periodically and if there are 15 excess funds in the account, then excess funds can be transferred to a high interest surplus saver. This is an optional feature that may be included if desired. In one case the account could be an interest offset account used to minimise interest payments that might apply to, for 20 example, a loan for an asset of the customer such as a home loan. This offset account could in one example be the everyday account 27 or the bill payment account 29. It should be appreciated that the term "payment" embraces money as the payment currency and that it also 25 embraces other currency such as "credits" or "trading equity", and is not to be limited only to money as the currency. Figure 6 is an overview functional diagram of the system. The front end application 41 includes a biller 30 administration module 41A and a customer services provider 43, hereinafter referred to as CSP, that contains software which enables customer registration, authentication, delegation, and biller registration, planning and - 16 management. This will be described further in due course. Also within the system 9 is a software component to manage a system server, a data warehouse 19, and an archive audit log 17 (see Figure 4). This operates within a secure 5 hosted environment via dedicated communication lines and links such as those used between banks and other financial institutions. The application software also includes a biller services provider component 47, hereinafter referred to as BSP, that includes modules for direct debit 10 registration, direct debit payment authorities, direct debit acknowledgments, direct debit management and direct debit payments. It can be seen that each of the modules 43, 45, and 47 is able to communicate with banks 5. It can also be seen that module 45 enables data to be extracted 15 from the system 9 for use in marketing within a marketing module 49. It can also be seen that each of the modules 45 and 47 communicate with the billers 3. The front end application is a web based application that is available for use by customers on a self service 20 basis via the Internet, or alternatively over the phone via call centres using the application, in person at bank branches where staff use the application on behalf of a customer, or in person with various third parties such as accountants, financial planners and the like. The front 25 end application captures all required customer information and stores all necessary information in the data warehouse 19 (see Figure 5). It also provides required information to customers 1, billers 3, and banks 5. The module 41 can be bank branded to particular banks needs and therefore 30 customised so customers 1 can recognise the system as being part of the particular banks service. The front end application has ten functions as follows: - 17 1. Customer Registration The module 41 captures customer 1 information needed 5 to establish various payment authorities with banks 5 and billers 3. The particular information is captured once but used many times for different billers 3. The information captured includes the following: (a) Name (individual or company); 10 (b) Address; (c) Mailing address if different; (d) Phone numbers; (e) E-mail address; (f) Demographic Information (e.g. sex, age, marital 15 status, household structure etc); (g) Bank account(s) details; (h) Other information that may be required for example, company business name registration number, tax file numbers and the like. 20 The module 41 enables the above information to be captured and passed to the system server and data warehouse in module 45 where it is securely stored. Information can be extracted from the module 45 to be provided to the biller service provider in the BSP module 25 47, to the banks 5, to the billers 3, and to the marketing campaign module 49. 2. Customer Authentication 30 Here, the module 41 interfaces with bank authentication systems to allow a customer's identity to be authenticated to bank standards. The authentication process may vary depending on the way in which the data is - 18 input. If the input is via the Internet, then the authentication may require "user names" and "passwords", or other authentication methods used by banks. If the input is via a bank branch, physical identification may be 5 required along with checking of documentation such as drivers licence, passport, and the like. If the input is over the phone, then the authentication can be via "user names" and "passwords", or unique pre-registered questions or other information held confidential by the customer. 10 It should be noted that with existing direct debit enrolment systems, there is no customer authentication required. Customers simply fill in a form, and their details are not verified against any authentication criteria. With the new system proposed in this example, 15 access is authenticated and therefore the system inherently knows that any usage will be valid and indisputable. 3. Customer Detail Changes 20 After initial registration in the system, a customer 1 can update any details that have changed through any of the available input types such as via the Internet, over the phone etc. Any customer changes are then provided to 25 all required parties such as banks 5, billers 3 and the like. The system enables the following items to be changed. (a) Customer registration details, such as customer address particulars; 30 (b) Additions of billers, modifications of billers or deletion of billers; (c) Changed bank account numbers; (d) Changes in budgeted amounts.

- 19 The system 9 automatically updates records that are maintained by billers 3, such as address of the customer 1. It should be noted that with current direct debit 5 systems, it is necessary for any changes to be advised to each biller individually by the customer. The process is almost entirely manual and has potential for errors. With the new system, in this example, the data is entered once and communicated by the system 9 to all required parties 10 such as banks 5 and billers 3. 4. Customer Delegated Authorities The system has a number of levels of authority for 15 access of the information contained within the service. High level roles are in relation to customer data, biller data, and bank data. The system permits a customer to delegate authorities to third parties and to assign varying levels of authorities such as "view only", or 20 "change or add authorities". A customer may delegate such authority to a trusted advisor such as an accountant, financial planner, lawyer or trustee. In the current direct debit process, delegated authorities do not exist. If a customer wishes to permit a 25 third party to view or access accounts, then a formal legal agreement is required such as a "Power of Attorney" or like document. 5. Customer Budget Planning 30 The budget planning tool is a web based application available through multiple, input means that captures, calculates, stores and allows access to and modifications - 20 to be made to a customer's requirements. The planning tool is set up to allow the customer to have control over how much money is expected to be required to meet bill commitments, and to allocate expenditure accordingly. The 5 budget planning tool captures customers expected expenditure amounts for each biller in categories. This is shown in Figure 5 where there is shown a list under the budget setting process showing particular billers. These are of course exemplary and other biller types may be 10 included. The tool is then set to determine the total expenditure over a given period such as an annual period, and to include a safety buffer. The total amount is then converted to a repayment equivalent (weekly, fortnightly, monthly, etc). This information is then passed to and 15 stored in the system server in module 45 and in the data warehouse from where it can be accessed to establish the necessary payment authorisations for particular billers, as to be described in relation to steps 7 and 8 hereinafter. Because the customer can dynamically update 20 data in the planning tool, the budget setting process is dynamic and keeps track instantly of customer's needs and payment commitments. Known budget tools are static, at a point in time that are not part of an actively managed budgeting and budget implementation process. As such they 25 quickly date and become less relevant and useful. The present system minimises this problem. 6. Biller Provided Details 30 The system captures individual biller details that include biller provided name, biller provider ID/Code, customers unique account number (if available) with each biller. Security validation processes using various check - 21 digit algorithms can be used to ensure that the details are correctly validated for each biller at the time of entry. In this way, by using check digit algorithms, accuracy can be ensured. The entered information is passed 5 to and stored in the system server and data warehouse within module 45 where it can be subsequently accessed for use. Current direct debit systems do not capture and validate the biller details in a way that the details can be stored and used to establish, modify and cancel 10 customer authorities electronically. The present system enables these features to be achieved. The present system also permits authorities to billers to be provided in an electronic form compatible with their systems and accessible on-line, 15 7. Establishes and Permits Modification of Bill Payment Authorities The system takes captured customer and biller 20 information and formats that information for storing in the system server and data warehouse fox- subsequent use. It also electronically forwards particulars to required billers concerning establishing, modifying or cancelling one or more bill payment authorities at a single point 25 on-line. Since any authority has originated under customer control via appropriate passwords and the like, it can be regarded as trusted advice that does not require any subsequent verification. The system receives batch notification for each biller authorised by a customer, and 30 dispatches that advice to respective billers. The biller can then confirm acceptance to complete the process. The example disclosed above contrasts significantly from current direct debit systems that require customers - 22 to seek application forms from billers for any establishment, modification or cancellation of authority. In some cases, a letter to a client's bank is sufficient authority to cancel a payment but again this requires 5 paper documentation trail. The example above is totally electronic. 8. Establishes and Permits Modifications of Bank Transfer Authorities 10 The biller administration module 41 takes the expected expenditure bill information input by a customer and calculates the average expenditure per salary cycle or other alternative periodic payment cycle. It then formats 15 and forwards an authority to the system for electronically forwarding onto the customers bank to permit establishing, modifying or cancelling a transfer to the customers dedicated account, from the customers everyday bank account from which payment is extracted, or directly from 20 the customer's salary. Some customers may chose to utilise their existing bank account for the service, such as when it is a mortgage secured line of credit for example. 9. Biller Administration 25 Here, the biller administration module 41 permits a biller to access the system via a secure authenticated interface. Here, the biller logs into the system. The system may provide for individual users at the billers' 30 premises to have a unique identification for audit processes. In addition, the unique identification of particular users at the biller can provide varying authority levels.

- 23 The biller administration module 41 provides a number of functions: (a) Biller preferences with regard to file formats, and delivery methods; 5 (b) Authority batches are alerted to the biller; (c) Biller can acknowledge receipt and processing of authorities; (d) Billers can look-up all authorities stored within the system for a biller; 10 (e) Billers can download customer information, to which they are permitted access for integration into customer records and CRM (Customer Relationship Management) records; (f) Billers can run various MIS (Management 15 Information System) reports into customer profiles and behaviour; (g) Billers can run marketing campaigns through the marketing module 49 if so permitted by the customer with respect to each markets privacy 20 regulations or other legislation. 10. Bank Branded and Customised The biller administration module 41 delivers 25 functionality to all licensed users of the system such as banks, and financial advisers. In this example, banks are able to customise the core system site to the banks logos and designs, product names, forms and the like. In addition, the system may permit use of a particular Trade 30 Mark for this system, which may be appropriate. Referring now to the module 45, it can be seen that this provides a secure hosted environment for the system server, the data warehouse, and an archive/audit log, all - 24 in the front end processing. This is a central repository for all data that is collected, required and generated by the system whether from customer 1, billers 3 or banks 5. It is hosted in a secure environment meeting the highest 5 possible industry security standards. The details of this have not been included but are well known in banking and other like industries including government and military organisations. In addition, the module 45 has access protocols designed to take into account national privacy 10 principles and customer consents. Again, this has not been disclosed in detail as the concepts are well known in banking and other industries. The environment of operation of the module 45 provides back-up and redundancy for running all application programs, and data protection. 15 Digital certificates and public key encryption technologies are used to identify and authenticate trusted users. The module 45 has five basic functions as follows: 20 1. Secure Host Environment The system application delivers information directly to banks 5 and billers 3. The environment is designed to meet the highest security and performance standards of 25 those organisations, and follows known protocols. The application hosting is outsourced to a third party provider to provide a secure hosted environment with redundancy and back-up standards required by banks, billers and the industry generally. Such systems are well 30 known and in use by banks for some functions such as e.g. CRM, payment gateways, and IT outsourcing contracts. 2. Data Warehouse - 25 The data warehouse is a central repository for all information captured and generated by the system. It is centrally stored on behalf of all banks 5 and billers 3. 5 The data can be accessed according to authorised permits and privileges. Information stored and managed in the data warehouse includes: (a) all customer 1 details, captured once and 10 stored in a single place so as to be readily updateable and accessible; (b) customer payment authorities for billers; (c) records of all participating billers 3 and their details and bill payment account; 15 (d) database of all customer budgets during the budget setting process, and the details thereof including the particular dedicated customer account into which budgeted payments are made and from which the system can take payments to 20 pay bills rendered by billers 3. The customers' details are linked relative to the billers' details as payment authorities and stored in the data warehouse. Known data warehouse technologies are utilised in the data warehouse 25 for data control. 3. MIS Database The system will generate large amounts of information 30 over time concerning customers 1, billers 3 and banks 5. This information can be interrogated by dedicated application software to provide information such as - 26 (a) individual customer expenditures, histories and trends over time; (b) household expenditure patterns by demographic segments; 5 (c) customer expenditure patterns by billers or categories of bills; and (d) other information that can be used in marketing. 10 4. Source Data for System Invoicing The database warehouse maintains information relevant for invoicing banks 5, biller's banks 7, billers 3 and customers 1. This information can include the following: 15 (a) number of plans active for each bank (i.e. the number of customers 1 with each bank); (b) number of direct debit authorisations created, modified or cancelled for each biller 3; (c) number of payments processed by the system on 20 behalf of billers 3; (d) number of customer 1 detail changes advised by billers 3; (e) number of customers 1 using the system to detail changed service; 25 (f) MIS reporting provided to customers 1; (g) marketing and event detection services for banks 5 and billers 3; (h) number of alerts generated for customers 1. (The alerts may comprise information that the 30 funds available to pay a particular bill are inadequate and that the customer has invoked an overdraft facility with a particular percentage rate interest component.) - 27 5. Annual Reviews The system maintains and allows for a process of 5 review of the customer's budgets overtime, and on an anniversary of the period (or at other periods as determined) and will do the following: (a) apply CPl/inflation/cost of living indexing to a customer's budgeted amounts; 10 (b) generate an updated budget and calculate a new amount to be transferred on each cycle of payment into the specialised account from which bills are paid; (c) provide a file to each bank 5 to allow the bank 15 5 to send annual review letters to each of its customers 1; (d) based on each banks customer management protocols, updated customer budgets will be alerted to customers relationship managers; 20 (e) where delegated authorities exists for third parties access, such as accountants and financial planners, updated budgets can be notified to these delegated authorities for use in their service to the customers; 25 (f) identify key gaps in a customer's authorised billers 3 so a bank 5 or a biller 3 can target customers 1 or billers 3 to participate in the system. The biller' s service provider module 47 includes a 30 number of application programs responsible for providing electronic data to billers 3 and banks 5, to facilitate the establishment of an authority, a modification and/or a cancellation of payment authorities. These application - 28 programs receive information from the system front end application in module 43 or from the module 45, The data information can be transformed by the application programs in the biller service provider module 47 so that the data 5 is formatted to meet industry, bank, and billers standards. The application program also has a capacity to manage and submit payments to the banking system should billers require this service. The biller's service provider module 47 has four functions as follows: 10 1. Direct Debit Registration (DDR) The biller service within the system: (a) receives information from the front end within 15 the customer service provider module 43 for each biller 3 requested by each customer 1. This information may be file particulars relating to the biller and its bill payment account particulars; 20 (b) processes information to a format compatible with a direct debit (or other payment system); (c) sorts customers requests by biller 3; (d) generates batch files to be sent to the biller 3 on an agreed schedule, or on a real time 25. basis; (e) sends a file to the biller 3 or allows the biller to request a file, in the format and media requested and agreed with the biller (as stored in step 9 In the customer service 30 provider module 43 of the biller administration module 41); (f) updates the biller administration module 41 with batch file details; - 29 (g) sends an alert to the biller 3. This, for example, may include information that the customer has withdrawn its services from the bank 5, or that the customer 1 has disputed a 5 bill. 2. DDR Acknowledgement The system services batch billing of billers 10 according to authorisations. The system therefore can send an alert to a biller 3 during each batch. The acknowledgment process includes the following: (a) biller 3 logs into the biller administration module 41; 15 (b) biller 3 reviews batch file which shows customer details; (c) biller 3 indicates acceptance and processing of each request to be part of the system; (d) the system reconciles acceptances with batches; 20 (e) the system follows up exceptions with billers 3 to ensure all customer 1 requests are enacted. This process differs from current paper based direct debit systems which do not have a closed loop to ensure requests by customers are accepted and actioned. 25 3. DDR Management Here the system: (a) maintains a database of all payment authorities 30 received from customers 1; (b) is accessible by billers 3 to check the provided authorities and to validate authorities when required; - 30 (c) is accessible to confirm authorities provided and if account/payments are disputed by customers. Current direct debit management processes require 5 each biller 3 to keep paper copies of payment authorities in case there is a challenge. The system in this example does not require paper authorities and maintains an electronic record of all authorities provided that can be accessed at any time by a biller 3. 10 4. DDR Payments Here, the system has an option of processing and managing payment for billers 3 if requested. If requested, 15 the following occurs: (a) biller 3 requests a file of customers 1 with account and payment due details; (b) a file is then created with the customer 1 payment authorities file, and a direct debit 20 file is then created to bank standards. (c) the system submits the file to a bank 5; (d) the bank 5 processes the file; (e) the bank advises the system of payments completed and any exceptions; 25 (f) the systems provide a file back to the biller 3 to update payment records. The current direct debit systems require each biller to lodge their own files direct with their bank. The above example permits billers to manage payments and processing. 30 Referring now to Figure 7a and 7b, various method steps involved in a budget setting and customer registration and biller registration process are shown. Here, at step 71 a customer 1 is directed to a budget - 31 setting application within the customer service provider module 43. At step 73, the customer provides a list of multiple billers and the quantum of bills from those billers over a required period such as 12 months. The 5 particular billers can be ascertained by the customer from past bills rendered by the billers 3 to the customer 1. The customer 1 can determine the quantum of such bills over a required period (such as 12 months) from past bills received from the particular billers 3. At step 75, all 10 the quantums of the bills are totalled. At step 77, the system determines a required customer payment cycle per salary payment period or like period. For example, if the customer 1 is paid fortnightly, then at step 77 the system will determine the fortnightly payment required to achieve 15 the total of all quantums over the required period. If the customer 1 is paid monthly, then step 77 will determine the monthly customer payment required to achieve the total of all quantums over the required period. At step 79, customer 1 is required to commit to the required customer 20 payment determined at step 77. If the answer is NO, then the customer is redirected to step 73 so the list of multiple billers can be adjusted such as by deleting one or more billers. If the answer is YES at step 79, then the system requires the customer 1 to establish or nominate a 25 customer's "pay from" account from which all bills will be paid. This process occurs at step 81 and provision exists for the account to be automatically established from within the system if the Bank's system permits. At step 83, the system determines if the billers identified by the 30 customer 1 at step 73 are already registered in the system. If the answer is YES, the system proceeds to step 85 and links the details of the customer 1 with the billers 3 and the quantum of such bills. In addition, the - 32 linking involves noting the particular "pay from" account established at step 81. If the billers are not registered in the system, the system then proceeds to step 87 where details of billers are obtained for registration in the 5 system. This process may involve an interrogation of industry databases or other banks or financial institutions for the required details of billers. If biller's details are present at some remote location then the details are obtained and the biller is registered at 10 step 89. The billers details are then stored in the database in module 45 at step 91. Simultaneously, the biller information is then linked to the customers profile at step 85. The linked details are then stored in the database in module 45 at step 93. At step 95, the customer 15 is then finally registered in the system. Referring now to Figure 8, there is shown the process steps involved in a biller 3 forwarding a bill to a customer 1, and to the system to enable payment of the bill. Here, at step 101, a bill is dispatched on behalf of 20 the biller 3. This bill may be dispatched directly from the biller 3 itself or by a third party transaction service organisation acting on behalf of the biller 3. The bill is then sent to the customer at step 103. This may be done electronically or via conventional paper mail or 25 both. Before or at the due date the Biller sends a file to their Bank of customer bill payments required and the due date. On the due date this file is processed and payments made in line with the payment authorities held. The period between bill issuance and payment due date enables the 30 customer 1 to dispute a bill and to suspend payment in the system if required. At step 109, the customer's bill payment account is debited for the amount of the bill and at step 111, the debited quantum is paid into the billers - 33 bill ^pay into" account such as accounts receivable account. An archive audit log occurs at step 113 concerning all transaction details. The above description has outlined one example of a 5 preferred embodiment. It should be appreciated that many variations may be made to the example described above and yet still be within the inventive concept. For example, in an alternative embodiment, the system may be set-up so that a customer must authorise payment of bills for each 10 bill received by the customer. In addition, there may be a facility provided to allow the customer to select certain billers that can be automatically paid, where as other billers need to receive an approval from the customer prior to the billing being made. 15 Throughout the description of the example of the preferred embodiment, the system 9 has been shown independent of a bank 5. It should be appreciated however, that for the purposes of this specification, including the claims, the term "bank" is to embrace the system 9. 20 In the claims which follow and in the preceding description, except where the context requires otherwise due to express language or necessary implication, the word "comprise" or variations such as "comprises" or "comprising" is used in an inclusive sense, i.e. to 25 specify the presence of the stated features but not to preclude the presence or addition of further features in various embodiments of the invention. It is to be understood that, if any prior art is referred to herein, such reference does not constitute an 30 admission that the publication forms a part of the common general knowledge in the art in any country.

Claims (21)

1. A method of managing direct debit authorities comprising the steps of: 5 receiving a request to change at least one financial account from an old financial institution to a new financial institution; receiving at least one direct debit authority associated with the old financial institution ; 10 providing the new financial institution the at least one direct debit authority; sending a transmission to at least one biller that relate to the at least direct debit authority, regarding the change of financial institution, such that the at 15 least one biller can draw funds from the new financial institution based on the at least direct debit authority.

2. A method in accordance with Claim 1, comprising the additional step of providing the customer the at least one 20 direct debit authority for revision by the customer.

3. A method in accordance with Claim 1, comprising the additional step of receiving customer revisions to at least one direct debit authority. 25

4. A method in accordance with any one of the preceding claims wherein a batch file is created for the at least one biller, the batch file comprising a reviewed and/or revised direct debit authorities. 30

5. A method in accordance with Claim 2, wherein the batch file is formatted to correspond with the at least one biller, such that the at least one biller can download - 35 the one or more batch files.

6. A method in accordance with any one of the preceding claims wherein the batch files are created on a periodic 5 basis.

7. A method in accordance with any one of the preceding claims comprising the additional steps of: requesting the old financial institution for the 10 least one direct debit authority; and; receiving the at least one direct debit authority from the old financial institution for switching to the new financial institution as a batch file. 15

8. A method in accordance with any one of the preceding claims comprising the step of; sending a message to the customer confirming the old financial institution has agreed to change at least one financial account and the at least one direct debit authority from the old financial 20 institution to the new financial institution.

9. A method in accordance with any one of the preceding claims wherein the at least one direct debit authority is formatted to correspond to a suitable format of the new 25 financial institution.

10. A method in accordance with any one of the preceding claims wherein the method comprises the steps of: providing a transmission to the customer confirming 30 initiation of changing a financial account, providing a temporary password with the customer such that the customer can access the at least one direct debit authority to review or revise the at least one direct - 36 debit authority.

11. A method for managing direct debit authorities comprising the steps of: 5 receiving information regarding creation of a new financial account at a new financial institution from the customer; receiving at least one direct debit authority that needs to be switched to the new financial institution from 10 the customer; switching the at least one direct debit authority to the new financial institution providing the at least one direct debit authority to the new financial institution; 15 sending a transmission to at least one biller that relate to the at least direct debit authority, regarding the change of financial institution, such that the at least one biller can draw funds from the new financial institution based on the at least direct debit authority. 20

12. A method in accordance with Claim 11, comprising the additional step of preparing a batch file comprising the at least one direct debit authority for transmission the biller. 25

13. A method in accordance with Claim 11, comprising the additional step of receiving additions of new direct debit authorities that are linked to the new financial institution and providing the new direct debit authorities 30 to the new financial institution.

14. A method in accordance with any one of claims 11 to 13, wherein the customer can amend the direct debit - 37 authorities, the amended direct debit authorities being transmitted to at least one biller associated with the amended direct debit authority. 5

15. A method in accordance with any one of claims 11 to 14 comprising the steps of; receiving at least one new direct debit authority from the customer, the new direct debit authority being associated with the new financial institution, 10 providing the new direct debit authority to the new financial institution and at least one biller associated with the new financial institution.

16. A method in accordance with any one of the preceding 15 claims, wherein a batch file is created, the batch file comprising all the amended direct debit authorities with the new financial institution, the batch file being provided to one or more billers. 20

17. A method in accordance with claim 16 wherein the batch file are created periodically.

18. A direct debit authority management system comprising: 25 a customer interface arranged to receive customer information, the customer interface further arranged to enable a customer to input an instruction to create a direct debit authority; a processor arranged to create and establish a direct 30 debit authority for at least one biller in response to the customer input, the direct debit authority being based on at least the customer information received via the customer interface; - 38 a storage repository arranged to store the customer information received by the interface and store the created at least one direct debit authority; and wherein the processor being arranged to provide the 5 direct debit authority to the biller, the direct debit authority linking the customer with the biller, such that a biller can withdraw funds from a customer based on the established direct debit authority. 10

19. A direct debit authority management system in accordance with Claim 1, wherein the system is arranged to allow a customer to add, modify, suspect, deactivate or delete direct debits, the system automatically updates the changes made by the customer. 15

20. A direct debit authority management system in accordance with Claim 1 or Claim 2, comprising a biller interface arranged to receive information from a biller and communicate with a biller. 20

21. A computer based method for managing direct debit authorities comprising the steps of: receiving instructions from a customer to create or modify at least one direct debit authority relating to at 25 least one biller; creating and storing the at least one direct debit authority; providing the at least one direct debit authority to the at least one biller to link the customer to the at 30 least one biller, enabling the at least one biller to draw funds from a customers' financial account based on the created direct debit authority.