Evolving Payment Token Merging Rewards and Payments
Find Innovative SolutionsGenerate Solutions
Solution Overview
Problem
In regions where credit cards and bank accounts are less prevalent, consumers lack access to convenient and secure payment methods, and merchants face challenges in developing consumer loyalty without incurring high costs.
Innovation Solution
An evolving payment device system that uses a token which, upon repeated use by a consumer, transforms from a coupon or rewards device into a payment device, associating consumer information and providing escalating benefits, thereby promoting loyalty and reducing merchant costs.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If merchants provide large benefits to attract business and develop consumer loyalty, then consumer loyalty is improved, but merchant costs increase
Solution Approach 1:
The token evolves dynamically from a rewards device to a payment device as the consumer uses it across multiple transactions. The system automatically transitions the token's function based on usage patterns, allowing merchants to provide benefits initially through rewards while eventually capturing payment information without additional cost.
Solution Approach 2:
The evolving token serves multiple functions: initially as a rewards/coupon device that provides benefits to consumers, and later as a payment device that captures consumer information. This multi-functionality allows the single token to address both consumer incentive needs and merchant data collection needs.
2Adaptability or versatility
If consumers are required to register for and apply for new payment accounts, then payment account establishment is achieved, but consumer convenience deteriorates due to background checks and application requirements
Solution Approach 1:
The system performs preliminary actions by first providing the token as a rewards device without requiring consumer registration or personal information. Consumer information is collected automatically in the background as the token is used across transactions, eliminating the need for upfront application processes.
Solution Approach 2:
The evolving token acts as an intermediary that bridges the gap between consumers and payment accounts. Consumers interact with the simple token initially, while the system gradually associates payment account information with the token through usage patterns, shielding consumers from complex registration processes.
3Adaptability or versatility
If merchants use separate loyalty cards and payment devices, then consumer benefits and payment functions are provided, but device complexity increases
Solution Approach 1:
The system merges the rewards device and payment device functions into a single evolving token. The token combines benefit accumulation capabilities with payment processing functionality, allowing consumers to use one device for both purposes rather than carrying separate cards.
Solution Approach 2:
The evolving token is designed as a universal device that performs both rewards and payment functions. It adapts its primary function based on usage context, serving as a benefits device initially and evolving into a payment device, thereby replacing multiple separate devices.
Data Source
AI summary
A computer apparatus is provided that comprises processor and a computer-readable medium coupled to the processor. The computer readable medium comprises code executable by the processor for implementing a method that comprises receiving a first indication at a computer apparatus that an evolving token has been used in a first transaction. Use of the evolving token in the first transaction provides a first benefit. The method further comprises that in a subsequent transaction after the first transaction, the evolving token changes so that it is associated with a payment account and the evolving token can be used to make payments.