Aggregator Server Unique Identifier for Recurring Payments
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Solution Overview
Problem
Existing payment systems face challenges in processing recurring payment transactions timely and automatically due to banks categorizing them as mail order or telephone order transactions, leading to fraudulent transaction declines and increased complexity for merchants and issuers.
Innovation Solution
An aggregator server is introduced to receive standing instruction requests, generate unique identifiers, and authorize recurring payments across different payment networks, eliminating the need for additional user authentication and simplifying the process by acting as a centralized hub for processing recurring transactions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If banks categorize recurring payment requests as mail order or telephone order transactions, then security is improved by requiring authentication, but processing efficiency deteriorates due to transaction declines and manual intervention
Solution Approach 1:
The patent introduces an intermediary system (recurring payment processing system) that sits between the customer and the bank. This intermediary generates unique identifiers for recurring payments and manages the authentication process, allowing banks to recognize these as legitimate recurring transactions rather than suspicious mail order/telephone order transactions, thereby maintaining security while improving processing efficiency
Solution Approach 2:
The system performs preliminary authentication when the recurring payment relationship is first established. Once authenticated, the system generates unique identifiers that allow subsequent recurring payments to be processed automatically without requiring repeated authentication, resolving the contradiction between security and processing efficiency
2Adaptability or versatility
If merchants implement recurring payment processing with multiple issuing entities and payment networks, then coverage is improved, but system complexity increases due to multiple identifiers and jurisdictional rules
Solution Approach 1:
The patent creates a universal recurring payment processing system that works across multiple issuing entities and payment networks. The system generates unique identifiers that are recognized across different jurisdictions and payment networks, providing a single standardized approach that replaces the need for merchants to implement separate complex systems for each issuing entity and network
Solution Approach 2:
The system changes the parameter of identifier generation from being issuer-specific to being system-generated and universally recognized. By centralizing the identifier generation in the recurring payment processing system rather than having each issuing entity create their own identifiers, the system achieves multi-network coverage while reducing complexity
3Reliability
If customers perform multiple manual payment transactions to complete recurring payments, then authentication security is maintained, but customer convenience deteriorates
Solution Approach 1:
The system performs authentication preliminarily when the recurring payment is first set up. Once the customer authenticates the initial recurring payment relationship, the system generates unique identifiers that enable automatic processing of subsequent payments without requiring the customer to repeatedly authenticate or manually initiate transactions, thus maintaining security while dramatically improving convenience
Data Source
AI summary
Embodiments provide electronic methods and systems for performing recurring payments to the merchants. The method performed by an aggregator server includes receiving a standing instruction (SI) request including a plurality of unique data fields from an acquirer server. The unique data fields represent setting up of a recurring payment transaction from a payment instrument of a user to a merchant account of the merchant. The method includes generating and storing a unique identifier corresponding to the SI request. The method includes transmitting the SI request along with the unique identifier to an issuer server associated with the payment instrument to authorize the SI request for processing the recurring payment. The method further includes receiving an authorization response message in response to successful authorization of SI request by issuer server. Further, method includes transmitting authorization response message along with unique identifier to acquirer server for setup of SI for recurring payment.