BoA, VISA Sued for Patent Infringement by Every Penny Counts

Bank of American and VISA were recently sued by Every Penny Counts, Inc. which alleges that BoA's "Keep the Change" program infringes upon its 1995 patent for a "Method and system to create and distribute excess funds from consumer spending transactions." When a participant in "Keep the Change" makes a purchase with his or her debit card, the Bank "rounds up" the amount deducted from the card holder's account to the nearest dollar and then puts that extra change into a savings account. In the UK, the idea has been copied by Lloyds TSB.

Last summer, BusinessWeekOnline did a big write up on how BoA, wanting to bring in new accounts, hired "an innovation and design research firm" to "conduct ethnographic research on boomer-age women with children." Women with children apparently have a tendency to round off entries in their checkbooks to an even amount, and they have a hard time saving money. Taking this important information, BoA

put together a team of product managers, finance experts, software engineers, and operations gurus and held 20 brainstorming sessions. The team generated 80 product concepts, boiled them down to 12, and overwhelmingly favored one: rounding up the financial transactions of consumers and transferring the difference to their savings.

The final little twist to this story is that at least one report in the blogosphere suggests that BoA filed for a patent on the "Keep the Change" idea itself.