Closed Loop Card Conversion to Multi-Merchant Gift Codes
Find Innovative SolutionsGenerate Solutions
Solution Overview
Problem
Gift cards often go unredeemed due to geographic limitations or personal disinterest, leading to significant unredeemed funds that can escheat to the state, with existing cards having restrictions and complex fees.
Innovation Solution
A system that converts closed loop gift cards into gift codes usable at multiple merchants by deactivating the original card and offering the funds at a discount, allowing the funds to be redeemed without expiration, using a multi-process secure gateway to communicate with closed loop card processors and provide the gift codes to users.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If closed loop gift cards are issued with merchant-specific restrictions, then the card value is preserved for the intended merchant, but the card becomes unredeemable to recipients who cannot or do not wish to use that specific merchant
Solution Approach 1:
The system introduces a multi-merchant platform as an intermediary that accepts various closed loop gift cards and converts them into redeemable value. The platform acts as a mediator between the original merchant-specific card and the recipient's needs, allowing conversion of restricted cards into usable value through resale or exchange mechanisms.
Solution Approach 2:
The system changes the parameters of the gift card by converting it from a closed loop, merchant-specific instrument to an open loop, multi-merchant redeemable code. This transformation modifies the card's accessibility parameters while preserving its monetary value, enabling recipients to use the value at different merchants or cash out.
2Reliability
If closed loop gift cards have expiration dates and complex fees, then the merchant can manage liability and encourage timely use, but the recipient loses value and the card becomes less attractive
Solution Approach 1:
The system implements feedback mechanisms where card balances, expiration dates, and fee structures are continuously monitored and communicated to both merchants and recipients. This allows for dynamic management of gift card value, enabling timely redemption or conversion before value is lost to expiration or fees.
Solution Approach 2:
The system performs preliminary actions by offering to purchase or convert gift cards before their expiration or before fees reduce their value. This proactive approach allows recipients to secure the full value of their cards, while merchants can manage their liability by converting cards in advance of potential expiration.
3Adaptability or versatility
If closed loop gift cards are converted to gift codes usable at multiple merchants, then the redeemability and user benefit are improved, but the original merchant-specific value control is reduced
Solution Approach 1:
The system creates a copy or representation of the original gift card value in the form of a gift code or resale value. This copying process transfers the monetary value from the merchant-specific card to a more flexible format, allowing the original merchant to maintain control over their brand while enabling the recipient to access the value more freely through the platform's network.
Data Source
AI summary
Disclosed herein are systems, methods, and computer-readable storage media for generating a gift code. The system receives an indication from a first user identifying a closed loop card, receives a confirmation of an amount of money in an account associated with the closed loop card, offers to purchase the closed loop card at an amount less than the amount of money in the account associated with the closed loop card, and upon acceptance of the offer, deactivates the closed loop card. The system then offers to sell the amount of money at a discount rate to a second user, receives acceptance of the offer to sell the amount of money at the discount rate, and associates a gift code with the amount of money for use by the second user. Gift codes can have no expiration date. A multi-process secure gateway can confirm the amount of money.