Bank Of America Tries To Patent Keeping The Change?

from the anyone-know-where-the-patent-is? dept

Steve Mueller writes "I've recently been hearing an ad on the radio in Silicon Valley for Bank of America's "Keep the Change" plan. Basically, when you use your debit card, they round the purchase up to the next dollar and deposit the "change" in your savings account. It sounds interesting, but what really got me was the "patent pending" notice at the end of the commercial. This seems like yet another stupid business method patent. The website doesn't mention the patent pending status. " This program got a lot of attention last month when it was announced. Anyone know of the patent in question?


Reader Comments (rss)

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    identicon
    Oliver Wendell Jones, Nov 4th, 2005 @ 9:55am

    iTunes just got expensive

    I buy songs off of iTunes for $0.99. It shows up on my bank statement as $1.04 - I'm assuming due to tax or surchages of some sort.

    If I used this bank, suddenly all my iTunes purchases jump to $2 and even though I would get the money back (by withdrawing it from the savings account) it's just that much more of a hassle...

     

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      Anonymous Coward, Nov 4th, 2005 @ 10:18am

      Re: iTunes just got expensive

      1) This seems to only apply to debit cards, not credit cards.

      2) It seems like the money goes into YOUR savings account. Not sure how you think things get more expensive if you end up just shuffling the money around you own accounts.

       

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      lisa, Nov 4th, 2005 @ 10:21am

      Re: iTunes just got expensive

      You have to opt in to the program, and they only do it once a day on your total purchases.

       

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      Tyler, Nov 4th, 2005 @ 11:32am

      Re: iTunes just got expensive

      I've been using it for a few weeks now and it's great (imho). Although so far I've only seen it happen when I physically use my debit card - not online purchases. So I think buying on iTunes will stay the same.

      As for why it's useful...

      The theory is the same as before credit/debit cards were common place. People used to pay for things with with cash (you remember cash, don't you?) At the end of the day they'd have a pocket full of change, which they'd drop into a jar at home. A few months of saving your change quickly adds up to a hundred dollars or more.

      This plan might not suit everyone, but, for me, it's an easy way to save a little extra on top of what I normally deposit into my savings account each month.

      Another benefit: suddenly all (most) of your transactions are whole dollar amounts. It makes balancing your checkbook easier for those who do it by hand.

       

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    Wolfger, Nov 4th, 2005 @ 10:48am

    So let me get this straight...

    I buy something for $19.95, the bank takes $20 out of my checking account, and puts $0.05 into my savings account? I do not understand the purpose of this, other than, perhaps, to make my checks more likely to bounce...

     

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    Jeff, Nov 4th, 2005 @ 10:50am

    What is the point?????

    Why do I want them shuffling my money around for me? I can just transfer the damn money from checking to savings.... Is there any benefit?

    Admittedly, I'm too lazy to read about the offer myself.

     

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      anyone, Nov 4th, 2005 @ 12:04pm

      Re: What is the point?????

      How about the fact that all of their programming and system work is being done in India, they fired most of their American Tech folk.

      Does THAT give you the warm fuzzies?

       

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    Denis, Nov 4th, 2005 @ 10:54am

    No Subject Given

    Erm? The purpose is to encourage people to save some f*cking money. We're neck deep in debts as it is.

    I'm sure that there is also a difference in what the BoA can actually do with your money depending on what account it is deposited in. IE if it's in savings they can invest certain % of it or something.

     

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      Rook, Nov 4th, 2005 @ 11:05am

      Re: No Subject Given

      BOA will still make their %service fee off the total amount charged by the store, thus the stores costs are going up. I wonder who that will trickle down to?!!!

      Dumb program, nice try to grab a few more pennies.

       

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      Jane, Nov 4th, 2005 @ 12:25pm

      Hmm.. Maybe.

      Encouraging people to save could be it, but perhaps because of my cynical nature, and my lack of faith in the benevolence of credit card companies, I would argue they are doing it because
      1) Financial institutions like money in savings because they pay low interest, and they can use that money for other lending. Add up millions of customers, and that can be a nice chunk.
      2) The Bankruptcy legislation they had passed included several easter eggs for themselves, including raising the default interest rate to Usury levels of 30%+, the "universal default rule" which allows all accounts to raise your interest rate if you default on one, and other things to increase their profits.
      With the Federal Reserve recently mandating that all Credit Card companies double the minimum payments, you will see a lot of unhappy people start to go bankrupt (which is much harder to do now, of course) and pay usury on lines of credit. At that time, they will want to point to these types of programs and say "Hey! Look! We care about consumers and their savings. Look at this nifty plan we came up with that, maximum, saves people less than a dollar a day. Aren't we grand?"

       

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        COD, Nov 4th, 2005 @ 12:38pm

        Re: Hmm.. Maybe.

        The Federal Reserve did not mandate a doubling of payments. They have mandated that minimums be 1% of the balance, plus the applicable interest charges. This will force your outstanding balance down every month - no matter what. Today, many people are in a position where they are making a $250 minimum payment on a card who monthly interest charge is more than that - thus they go farther into debt each month even if they don't use the card. Yes, it does have the effect of raising the minimum in some instances, but at least you'll be paying off some principle each month.

         

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        sun818, Nov 4th, 2005 @ 12:39pm

        Re: Hmm.. Maybe.

        Accounting for expenses is a lot easier when you only deal with whole dollar figures. It actually is to your benefit because you can claim more on your income tax because the actual charge is rounded up. So, in effect, you are not spending any more for your personal expenses but on paper it looks like you spend a lot more. More expensives means more deductions. So you end up paying less in taxes.

         

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    discojohnson, Nov 4th, 2005 @ 11:08am

    I use it..

    ..and am liking it so far. During the intro period they match the savings $ for $ (3 months), and after that they give you back 5% of whatever goes into savings through the program. That's 5% above the normal savings account percentage rate, so that's just gravy. I'll basically have what, somewhere for me.

     

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      Anonymous Coward, Nov 4th, 2005 @ 11:36am

      Re: I use it..

      So for the first 3 months I can download songs for a cost of 8 cents each if I buy each in a seperate transaction?
      .99
      .5 (surcharge)
      ---
      1.04
      Round up 2.00
      - .96 (amount rounded up, that get's redeposited into my account)
      ---
      1.04
      -.96 (BoA's match to my savings)
      ---
      $.08 cost of a single music download transaction
      13 songs for the price of 1 a whole album for the price of 1 single song
      Given that a song lasts an average of 3.5 minutes
      I could buy a full year of music for $200

       

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    Jon, Nov 4th, 2005 @ 11:38am

    No Subject Given

    The way it works is that if you buy a pack of gum for $0.95, they charge your checking card for $0.95 and give you $0.05 for using your card. But as said above, it only hapens on the total purcahses for the day, so at the end of the day if you spent $134.82, they give you 12 cents for your using their card. My guess is that they want you to use their card and not a competitors and it's worth a possible 99 cents a day to keep you with them all the time (whats $30 a month if it stops citibank from getting $50 in interest from you

     

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      Steve, Nov 4th, 2005 @ 11:49am

      Re: No Subject Given

      It is per transaction, so it is possible to get more than 0.99 a day. However, they do the transfers in the evening so you will see all of your change as one transfer every day. No money is "given" to you on a daily basis. In your example if you buy a pack of gum for 0.95 tomorrow you will see a charge for 0.95 and a transfer of 0.05 to your savings. At the end of the year you will get another deposit from BofA into your savings account that is the match for the first 3 months and 5% for the rest of the year. You will loose your match if you cancel the service before your yearly aniversary.

      The intention of this program is to encourage customers to use the Debit side of their card which is more cost effective for the banks and merchants.

       

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      Anonymous Coward, Nov 4th, 2005 @ 11:49am

      Re: No Subject Given

      Nope, they keep track of the round-ups of *every* purchase. They make a transfer into your savings account once per day, but it is an aggregate of all round-ups of that day.

       

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    drew, Nov 4th, 2005 @ 11:39am

    great idea

    i think this is a great idea.

    it won't cross your mind, and then several months (or years) down the road, you'll remember it and have a pretty good size savings account without any effort.

    i do think they should implement some options for it, such as only rounding it off if its a certain amount. (so $x.01 purchases don't get marked up almost a whole dollar, etc...)

     

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      Jonathan Kotta, Nov 4th, 2005 @ 12:09pm

      Re: great idea

      I use a local bank, and they give me a dime everytime I use my debit card. Like this deal, it doesn't work when I use it as a credit card (e.g. online purchases). However, I use my Discover card for anything over $20, because after that the %0.5 reward is more than a dime. This BoA plan doesn't seem very competitive to me.

       

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    BofA customer, Nov 4th, 2005 @ 12:00pm

    what about debit card charges?

    It sounds like a good idea to deposit the change into a savings account, but what about the $1.50 charge for using a debit card? If you by a pack of gum for $0.75, you'll get $0.25 put into a savings account, and $1.50 charged against your checking account. So you've just paid $2.50 for a pack of gum, and only put $0.25 into savings.
    Doesn't sound as good as it did before. I think I'll stick with the automatic transfer of $25 into my savings account.

     

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      drew, Nov 4th, 2005 @ 12:04pm

      Re: what about debit card charges?

      you get charged for using your debit card?

      i am not a BofA customer, but the only time i get charged for using my debit card is when i get money out of an ATM that isn't owned by my bank...

       

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        Kat, Nov 4th, 2005 @ 12:22pm

        Re: what about debit card charges?

        mmm there are quite a few banks that charge you for using any ATM or using your debit card to make purchases at a store. I've only had to deal with them charging a $1.00 every time I used the bank card, (I had to use a different bank when I went on Vacation for 3 months) - SO every time I used my card anywhere, it was charged $1.00. If I needed money, It was cheaper to just ask for cash back when I purchased things with my card, that I needed from the store, than to go to the ATM each time. ... Back home here, I use a Credit Union, and I guess as long as I use another credit union's ATM or one from my own credit union, I'm not charged anything. (I'm also not charged for using my debit card at any stores or for online purchases either.) If I however use an ATM from any other bank, there is like... a $1.00 transaction fee, on top of whatever fee the bank charges for using their atm.

        I think it's a terrible waste of money to be honest. I can understand that they want their 'fees' for whatever reason... but... damn.. they need to stop gouging us for our hard earned money. we get enough of that with taxes and interest and things of that sort that we have to pay.

         

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    Steve Mueller, Nov 4th, 2005 @ 1:40pm

    Missing The Point

    I'm glad to see this has generated a lot of discussion, but I submitted it because of B of A's attempt to patent this. Doesn't anybody have any comment about that?

     

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    Hmm, Nov 4th, 2005 @ 1:54pm

    Good idea; bad patent

    It's a great idea, but patentable? Why? Just because it uses "teh internets"?

    Seriously, if the process exists in the real world, how the heck can someone patent the recreation of said process, practically verbatim, using bits and bytes?

     

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      Happy user, Nov 4th, 2005 @ 3:04pm

      Good idea; bad patent (Except ofcourse, you are go

      If BofA gets the patent on this, what is stopping a dancer from putting a patent on a dance move. I could imagine Chubby Checker's account $$$ balance every time someone did "The Twist".

      While were at it, let see the grocery stores patent the way box-boys load groceries into the bags -- and fast-food stores such as McDonalds and Burger King patent they or that food must be placed into their bags (burger always goes in first, with fries being the last thing placed into the bag)

      Does this all sound silly or does it sound like what BofA is attempting to do...

       

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      Slightly Disinterested, Nov 6th, 2005 @ 8:51pm

      Re: Good idea; bad patent

      I believe the "Patent Pending" was an attempt to be funny. Get it? They are trying to patent an idea my dad was doing with his pocket change on a daily basis?

       

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    sharon, May 21st, 2006 @ 1:45pm

    yep your checks will bounce

    it will cause a mess of things when use a "keep the change"debit card. You now just can't balance your checking acount the way you normally do ,you now have to check it every single time you use your debit card, you dont just think"oh great my "keep the change" money is really adding up, well as it adds up in your savings you checks are bouncing and your return check fees are REALLY adding up! I at first thought this money was coming from the bank from some money they are making from some place.like bounced check fees, but it seemed to good to be true and it is, they are the ones MAKING MONEY because many peoples checks will bounce and they get the BIG FEE. I can recall return check fees being 9 NINE dollars !! why did the fees go up so so much, they are doing the exact same thing they did when they charged 9 dollars ! crazy...

     

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    jim, Jul 9th, 2007 @ 8:52pm

    Dumb butt patent

    I usually spend dollar bill and rarely dig into my pockets for the change. So everyday I come home and throw the coins into a jar (a plastic holloween pumpkin). This is pretty much the same idea as BoA. Do you think this would count as prior art?

     

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