Cross-Border Payment Matching for Domestic Transaction Settlement
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Solution Overview
Problem
Global cross-border money transfers are expensive and inefficient due to reliance on intermediaries like banks and fintech platforms, leading to high fees, delayed transaction times, and unfavorable exchange rates, which hinder financial inclusion and equitable economic participation.
Innovation Solution
A peer-to-peer marketplace for cross-border transfers that enables direct transactions between users, bypassing intermediaries, with features for secure, transparent, and compliant currency exchange and transaction management, including dynamic rate adjustments, liquidity pools, and regulatory compliance.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If traditional intermediary systems (banks and fintech platforms) are used for cross-border transfers, then transaction security and regulatory compliance are maintained, but transaction costs increase and transaction speed decreases
Solution Approach 1:
The patent extracts and eliminates traditional intermediary banks and fintech platforms from the cross-border transfer system. By removing these intermediaries, the system achieves faster transaction speeds while maintaining security through direct peer-to-peer transactions with automated compliance checks, resolving the contradiction between reliability and productivity.
Solution Approach 2:
The patent introduces a decentralized digital infrastructure as a new intermediary that enables direct peer-to-peer transactions. This new intermediary provides the necessary security and compliance framework without the inefficiencies of traditional banking intermediaries, allowing fast transactions while maintaining reliability.
2Reliability
If traditional intermediary systems are used for cross-border transfers, then regulatory compliance is maintained, but transaction costs increase
Solution Approach 1:
The patent removes traditional banking intermediaries that impose high fees and unfavorable exchange rates. By eliminating these costly intermediaries, transaction costs are reduced below 3% while regulatory compliance is maintained through automated compliance checks and a decentralized legal framework, resolving the contradiction between compliance and cost.
Solution Approach 2:
The system enables users to conduct cross-border transfers directly without relying on traditional intermediaries. Users maintain their own digital accounts and execute transactions autonomously with automated compliance verification, eliminating transaction costs associated with intermediary services while maintaining regulatory adherence.
3Productivity
If peer-to-peer direct transactions are implemented, then transaction costs decrease and transaction speed increases, but system complexity and regulatory compliance challenges increase
Solution Approach 1:
The patent creates a universal digital infrastructure that handles multiple functions: currency conversion, compliance verification, transaction execution, and account management. This multi-functional system reduces overall complexity by consolidating what would otherwise require multiple separate systems, enabling fast peer-to-peer transactions while managing complexity through integration.
4Loss of energy
If peer-to-peer direct transactions are implemented, then transaction costs decrease, but legal compliance and regulatory adherence become more challenging
Solution Approach 1:
The patent performs compliance verification and legal checks as preliminary actions before transactions are executed. By conducting due diligence and regulatory compliance checks in advance, the system ensures that cost-effective peer-to-peer transactions adhere to legal requirements, resolving the contradiction between low cost and compliance reliability.
Data Source
AI summary
A system and method for facilitating cross-border financial transactions through a money movement transaction marketplace. The system allows users to trade cross-border transaction requests, matching complementary payment needs to enable conversion into domestic equivalents. It includes a matching engine for identifying transaction pairs, a conversion module for domestic settlement, and a compliance framework supporting Anti-Money Laundering (AML) and Know Your Customer (KYC) protocols. The marketplace reduces costs by enabling peer-to-peer trading of transactions, bypassing intermediaries and standard currency conversion processes. The system supports dynamic exchange rate determination, multi-currency operations, and integration with financial institutions via standardized Software System's Interfaces (e.g., APIs). Secure communication, encrypted data handling, and fraud detection mechanisms ensure compliance and reliability. By addressing inefficiencies in traditional cross-border systems, the invention promotes financial inclusion and aligns with global goals to provide accessible, cost-effective solutions for underserved populations while ensuring transparency and scalability in cross-border payments.