Four-party credit/debit payment protocol

Abstract

A method, system, program, and method of doing business are disclosed for electronic commerce that includes the feature of a “thin” consumer's wallet by providing issuers with an active role in each payment. This is achieved by adding an issuer gateway and moving the credit / debit card authorization function from the merchant to the issuer. This enables an issuer to independently choose alternate authentication mechanisms without changing the acquirer gateway. It also results in a significant reduction in complexity, thereby improving the ease of implementation and overall performance.

Description

[0001]This application is a reissue application for U.S. Pat. No. 6,327,578 issued Dec. 4, 2001 on U.S. Ser. No. 09 / 221,869 filed Dec. 29, 1998.FIELD OF THE INVENTION[0002]The invention disclosed broadly relates to computer networks and more particularly relates to electronic commerce.BACKGROUND OF THE INVENTION[0003]Electronic commerce is projected to grow at a high rate and this will have a significant impact on the financial industry. Estimates for 1998 are 700 million dollars worth of total revenues. Further growth promises $1 trillion by 2010. No financial institution will be left unaffected by the rapid growth of electronic commerce. One obstacle that can inhibit this growth, however, is the lack of secure electronic payments. Consumers and merchants are wary of transmitting their payment information over open networks such as the Internet and this caution affects the interest of merchants and financial institutions.[0004]The technology of electronic commerce has adopted a num...

AI Technical Summary

Benefits of technology

[0029]The invention disclosed herein is a method, system, program, and method of doing business for electronic commerce that expands the role of a “thin” consumer's wallet by providing issuers with an active role in each payment. This is achieved by adding an issuer gateway and moving the credit / debit card authorization function from the merchant to the issuer. This enables an issuer to independently choose alternate authentication mechanisms without changing the acquirer gateway. It also results in a significant reduction in complexity, thereby improving the ease of implementation and overall performance.

[0036]In this manner, a “thin” wallet is enabled for the consumer in an electronic commerce protocol that is significantly simpler than the SET protocol, and that pre-authorizes payments thereby improving overall performance and enabling greater flexibility for issuer in the authentication of cardholders.

Problems solved by technology

One obstacle that can inhibit this growth, however, is the lack of secure electronic payments.

Consumers and merchants are wary of transmitting their payment information over open networks such as the Internet and this caution affects the interest of merchants and financial institutions.

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