System and Method of Transaction Settlement Using Trade Credit

Abstract

A method and system for settling a transaction with trade credit value which makes use of computer hardware and software, allows Members of a trade credit settlement system to transfer electronic instruments, called trade credits, in exchange for goods and services. These trade credits are effectively electronic bills of exchange that are divisible, transferable, discountable, continuously available and have been credit-enhanced to A/P1 status. Sponsors facilitate the system by registering buyers and suppliers as Members in the system and offering them operational accounts and drawdown accounts with authorized lines of credit. A Member-buyer approves the purchase invoice of a Member-supplier and authorizes the Sponsor to transfer trade credit value from the Member-buyer's operational and/or drawdown account into the operational account of the Member-supplier. The trade credit value received by the Member-supplier can be held in the Member-supplier's operational account until it matures, or discount it to cash before it matures, or transfer it to other Members for the purchase of goods or services.

1 . A method of settling a transaction using trade credit value, comprising:
 storing trade credit value for a first user;   receiving a request from the first user to transfer a pre-determined amount of the stored trade credit value to a second user in settlement of the transaction;   confirming an availability of the requested amount of trade credit value stored for the first user for settlement of the transaction;   transferring the requested amount of trade credit value from the first user to the second user; and   allowing the transferred amount of trade credit value to be used by the second member in at least one of settlement of another transaction for the second user, discounting for cash before a pre-defined maturity of the trade credit value, and holding through to the pre-defined maturity of the trade credit value.   
   
   
       2 . The method of  claim 1 , wherein storing the trade credit value further comprises storing the trade credit value in an operational account of the first user. 
   
   
       3 . The method of  claim 2 , wherein storing the trade credit value in the operational account of the first user further comprises establishing the operational account for the first user in a trade credit settlement system. 
   
   
       4 . The method of  claim 3 , wherein establishing the operational account for the first user further comprises allowing the first user to register for membership in the trade credit settlement system. 
   
   
       5 . The method of  claim 4 , wherein allowing the first user to register for membership in the trade credit settlement system further comprises receiving an approval of a sponsor-member of the trade credit settlement system for the first user's registration for membership. 
   
   
       6 . The method of  claim 5 , wherein receiving the approval for the first user's registration for membership further comprises allowing the sponsor-member to register for sponsor-membership in the trade credit settlement system. 
   
   
       7 . The method of  claim 6 , wherein allowing the sponsor-member to register for sponsor-membership further comprises recognizing the sponsor-member as a valid trading entity by the trade credit settlement system. 
   
   
       8 . The method of  claim 1 , wherein storing the trade credit value further comprises storing the trade credit value in the form of a trade credit. 
   
   
       9 . The method of  claim 8 , wherein storing trade credit value in the form of the trade credit further comprises storing the trade credit as an electronic promissory obligation. 
   
   
       10 . The method of  claim 1 , wherein storing trade credit value further comprises storing the trade credit value as at least one of a divisible trade credit value, a continuously available trade credit value, a transferable trade credit value, a discountable trade credit value, a credit enhanced trade credit value, and an investment grade trade credit value. 
   
   
       11 . The method of  claim 1 , wherein storing trade credit value further comprises storing the trade credit value as a discountable and investment grade trade credit value. 
   
   
       12 . The method of  claim 1 , wherein receiving the request further comprises receiving the request to transfer the pre-determined amount of the trade credit value from at least one of an operational account and a drawdown account of the first user to an operational account of the second user. 
   
   
       13 . The method of  claim 12 , wherein receiving the request to transfer the pre-determined amount of the trade credit value from the operational account of the first user further comprises establishing the operational account for the first user in a trade credit settlement system. 
   
   
       14 . The method of  claim 13 , wherein establishing the operational account for the first user further comprises allowing the first user to register for membership in the trade credit settlement system. 
   
   
       15 . The method of  claim 14 , wherein allowing the first user to register for membership further comprises receiving an approval of a sponsor-member of the trade credit settlement system for the first user's registration for membership. 
   
   
       16 . The method of  claim 15 , wherein receiving the approval for the first user's registration for membership further comprises allowing the sponsor-member to register for sponsor-membership in the trade credit settlement system. 
   
   
       17 . The method of  claim 16 , wherein allowing the sponsor-member to register for sponsor-membership in the trade credit settlement system further comprises recognizing the sponsor-member as a valid trading entity by the trade credit settlement system. 
   
   
       18 . The method of  claim 12 , wherein receiving the request to transfer the predetermined amount of the trade credit value from the drawdown account of the first user further comprises establishing the drawdown account for the first user. 
   
   
       19 . The method of  claim 18 , wherein establishing the drawdown account for the first user further comprises allowing the first user to register for membership in a trade credit settlement system. 
   
   
       20 . The method of  claim 19 , wherein establishing the drawdown account for the first user further comprises receiving an approval of a sponsor-member of the trade credit settlement system of a request by the first user for the drawdown account. 
   
   
       21 - 86 . (canceled)