Direct Mobile Wallet Authorization to Reduce Transaction Fees

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Solution Overview

Problem

Existing mobile wallet systems incur high transaction fees due to reliance on third-party payment processing networks, which can be costly for merchants and limit the efficiency of direct payment processing.

Innovation Solution

Implementing a mobile wallet application that allows direct communication between the mobile device and the issuer, bypassing traditional payment processing networks, using a separate mobile wallet network for lower fees and enabling direct payment authorization.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Reliability

If traditional payment processing networks are used for mobile wallet transactions, then payment authorization can be obtained through established infrastructure, but transaction fees are high for merchants

Engineering Contradiction:

Improvepayment authorizationVSAvoidtransaction fees

Core Design Contradiction:

ReliabilityVSLoss of energy

Solution Approach 1:

The patent extracts the mobile wallet application from the traditional payment processing network infrastructure and creates a separate direct communication path between the mobile device and the issuer. This extraction eliminates the intermediary payment processing networks that charge fees, while maintaining the essential payment authorization function through direct issuer communication.

Inventive Principle:

Principle #2Taking out (Extraction)

Solution Approach 2:

The patent introduces a new intermediary layer - the mobile wallet application with its own network - that sits between the POS system and the issuer. This intermediary enables direct communication and authorization while bypassing the traditional payment processing networks, thus reducing fees while maintaining reliable payment processing.

Inventive Principle:

Principle #24Intermediary (Mediator)

2Loss of energy

If direct communication between mobile device and issuer is implemented, then transaction fees are reduced, but system complexity increases

Engineering Contradiction:

Improvetransaction feesVSAvoidpayment processing system

Core Design Contradiction:

Loss of energyVSDevice complexity

Solution Approach 1:

The mobile wallet application serves multiple functions: it acts as a communication bridge between the POS system and issuer, stores payment credentials, manages security tokens, and handles direct authorization requests. This multi-functionality consolidates what would otherwise require separate systems, managing complexity while enabling direct communication.

Inventive Principle:

Principle #6Universality (Multi-functionality)

Solution Approach 2:

The system enables self-service authorization where the mobile wallet application autonomously communicates with the issuer to obtain payment authorization without requiring manual intervention or complex intermediary processing. The application manages the entire direct communication process, simplifying the overall system architecture.

Inventive Principle:

Principle #25Self-service

Data Source

PatentUS12393927B1Direct payment authorization path

Publication Date: 2025.08.19 WELLS FARGO BANK NA

AI summary

Various examples described herein are directed to systems and methods for processing a payment using a mobile wallet network and issuer. A mobile wallet application provides payment information and an indication if payment may be done directly via the mobile wallet network to a point of sale (POS) terminal. The POS terminal determines which payment network to use. A bill may be sent to the mobile wallet application. The mobile wallet application requests payment authorization from an issuer. The issuer provides the authorization and the transaction is completed between the POS terminal and the mobile wallet application.