Credit Card Reward Optimizer Using Location-Based Merchant Detection
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Solution Overview
Problem
Consumers face difficulty in determining which credit card to use for a transaction to maximize rewards due to complex and varied reward programs, making it challenging to optimize transactions with multiple credit cards.
Innovation Solution
A computing device with a location determinator, merchant information detector, and category/sub-category detector recommends the most suitable credit card by analyzing store types and merchandise classifications, comparing reward rules, and ranking payment applications based on available rewards and user-defined goals.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If consumers manually track and compare reward rules across multiple credit cards, then they can optimize rewards for transactions, but the complexity and time required increases exponentially with the number of cards
Solution Approach 1:
The patent introduces a computing device as an intermediary between the consumer and multiple credit cards. This device automatically retrieves account information, reward rules, and transaction data, then processes and compares them to determine optimal card selection. The intermediary handles the exponential complexity of tracking multiple cards, freeing the consumer from manual tracking while maintaining reliable reward optimization.
Solution Approach 2:
The computing device performs self-service by automatically retrieving account information from financial institutions, detecting merchant categories, determining transaction categories, and comparing reward rules without requiring consumer intervention. The system autonomously manages the complexity of tracking multiple credit cards and their varying reward structures.
2Loss of information
If consumers manually assess which credit card provides the best reward for each transaction, then they can make informed decisions, but the time required for decision-making increases
Solution Approach 1:
The computing device performs preliminary actions by continuously retrieving and storing account information and reward rules for multiple credit cards before transactions occur. The system pre-processes reward data, organizes it by merchant and transaction categories, and prepares comparisons in advance. When a transaction opportunity arises, the pre-processed information enables rapid decision-making without sacrificing accuracy.
Solution Approach 2:
The system provides feedback to the consumer by communicating the selected credit card and the reward benefits associated with that selection. This feedback loop allows the consumer to verify the optimization is working correctly while the automated process maintains speed.
3Measurement precision
If the system tracks detailed transaction data and reward rules for multiple credit cards, then reward optimization accuracy improves, but the amount of data to be processed increases
Solution Approach 1:
The patent segments the large volume of data by organizing it into distinct categories: merchant categories (detected from location and merchant information), transaction categories (determined from merchant and purchase data), and reward rules (retrieved for each credit card). This segmentation allows the system to process and compare only relevant data subsets for each transaction type, maintaining precision while managing data volume efficiently.
4Adaptability or versatility
If consumers use multiple credit cards with different reward programs, then potential reward benefits increase, but the difficulty of determining the best card for each transaction increases
Solution Approach 1:
The computing device serves multiple functions: it retrieves account information from various financial institutions, detects merchant categories from different data sources (location, merchant information), determines transaction categories, retrieves diverse reward rules (points, cashback, miles), and compares them all through a unified process. This multi-functionality allows the system to handle diverse reward programs while maintaining simple operation for the consumer.
Data Source
AI summary
A computing device including a location determinator including a position detector, a merchant information detector, and a category or subcategory detector. The computing device also includes one or more processors and one or more non-transitory computer-readable storage media embodying computer-readable instructions, which can determine at least one of category or sub-category of a potential transaction based on information derived from the location determinator, retrieve account information of a plurality of payment applications, retrieve reward rules associated with each of the plurality of payment applications, determine available rewards based on each of the retrieved reward rules, based on the determine available rewards, rank each of the plurality of payment applications, and communicate information of a highest ranked payment application to a point of sale terminal.