Online electronic transaction and funds transfer method and system

A method of conducting a plurality of purchases of goods or services of variable amounts by a customer from one or more participating vendors over a computer network using a system manager, said customer having a customer bank account at a financial institution and said participating vendors each having a vendor bank account at a financial institution, said customer and vendor bank accounts being accessible through the Automated Clearing House system, comprising:

• a) providing an intermediary bank account at a financial institution for receiving customer deposits, said intermediary bank account being accessible through the Automated Clearing House system;
• b) assigning said customer a customer identification number;
• c) maintaining an account representing the balance of funds held to said customer's credit in said intermediary bank account and associating said balance with said customer identification number;
• d) providing a Pre-Authorized Debit authorization to said system manager to draw funds from said customer bank account, whereby said authorization permits said financial institution holding said customer bank account to honor a Pre-Authorized Debit issued by said system manager on said customer bank account permitting said system manager to draw funds from said customer bank account without said financial institution holding said customer bank verifying that terms of said authorization have been complied with before said funds are released;
• e) said customer instructing the system manager to make a first Pre-Authorized Debit payment to thereby transfer funds from said customer bank account to said customer's credit in said intermediary bank account in association with said customer identification number;
• f) communicating over said computer network a proposed purchase amount in respect of a first purchase of goods or services by said customer from a participating vendor, an identification of the vendor to receive said proposed purchase amount and said customer identification number to said system manager;
• g) said system manager confirming the availability of funds to cover said proposed purchase amount in said intermediary bank account in association with said customer identification number and communicating over said computer network confirmation to said vendor that the proposed purchase can proceed;
• h) if sufficient funds to cover said proposed purchase amount are available in said intermediary bank account in association with said customer identification number, transferring the amount of said proposed purchase amount to said vendor bank account from said intermediary bank account and debiting the account of said customer in said intermediary bank account and confirming said transfer to said customer and said vendor;
• i) communicating over said computer network proposed purchase amounts in respect of subsequent purchases of goods or services by said customer from one or more participating vendors, an identification of the one or more vendors to receive said proposed purchase amounts and said customer identification number to said system manager;
• j) said system manager confirming the availability of funds to cover said proposed purchase amounts in said intermediary bank account in association with said customer identification number and communicating over said computer network confirmation to said one or more vendors that the proposed purchases can proceed;
• k) if sufficient funds to cover said subsequent proposed purchase amounts are available in said intermediary bank account in association with said customer identification number, transferring the amount of said proposed purchase amounts to said one or more vendor bank accounts from said intermediary bank account and debiting the account of said customer in said intermediary bank account and confirming said transfer to said customer and said one or more vendors;
• and
• l) either before or after steps f)-k) said customer instructing the system manager to make one or more additional Pre-Authorized Debit payments to thereby transfer additional funds from said customer bank account to said customer's credit in said intermediary bank account in association with said customer identification number to thereby provide sufficient funds in said intermediary bank account for said first or subsequent purchases of goods or services by said customer from said one or more participating vendors.