Financial Account Verification with Coded Debit and Credit Transactions
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Solution Overview
Problem
Existing methods for verifying customer-provided financial account information are insecure and costly, with limited unique combinations and high transaction costs.
Innovation Solution
Implementing debit and credit transactions with embedded verification codes in the statement descriptor, allowing customers to verify their accounts using unique codes, and optionally using offsetting transactions to minimize costs.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If two ACH credit transactions with random amounts between 0.01 and 0.99 dollars are used for verification, then account verification can be performed, but the number of unique combinations is limited to about 10000
Solution Approach 1:
The patent changes the parameters of the verification transactions by using fixed, predetermined amounts (e.g., $0.01 and $0.02) instead of random amounts between 0.01 and 0.99. This parameter change, combined with embedding unique verification codes in the statement descriptors, dramatically increases the number of unique verification combinations while maintaining security and reducing costs.
Solution Approach 2:
The patent introduces verification codes as an intermediary element embedded in the statement descriptor of the transactions. These codes serve as a mediator that carries unique identification information without requiring variable transaction amounts, thereby expanding the verification capability beyond the limited 10000 combinations of the previous method.
2Reliability
If multiple credit transactions are used for verification, then account verification can be performed, but transaction costs increase for the sending party
Solution Approach 1:
The patent implements a self-service verification mechanism where the customer's own account transactions serve as the verification medium. By using the customer's existing bank account and generating transactions that appear on their statement, the system eliminates the need for separate verification fees or costly external verification services, thereby reducing transaction costs while maintaining reliability.
Solution Approach 2:
The patent changes the transaction structure by using fixed, minimal amounts ($0.01 and $0.02) with embedded verification codes, replacing the previous approach of using larger random amounts. This parameter change reduces the financial cost of each verification transaction while the verification codes ensure the transactions remain uniquely identifiable and secure.
Data Source
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AI summary
Embodiments of the invention describe methods and systems for verifying customer supplied financial account information verification using debit and credit transactions. These methods include electronically receiving customer supplied financial account information, and electronically processing the received customer supplied financial account information by a back end component. At least one transaction comprising an electronic debit transaction or an electronic credit transaction is electronically generated by the back end component. A first verification code that is unique at least for each customer financial account is electronically randomly generated, and electronically added to the statement descriptor of a transaction. At least one transaction is stored and electronically transmitted to a transaction processing system using an encrypted communication protocol. The at least one transaction is posted, as one or more entries on the customer financial account. A second verification code is received responsive to the first verification code from the customer. The method also includes comparing the first verification code and the second verification code with respect to each other, verifying the customer supplied financial account information responsive to said comparing, and providing the customer with electronic access to use the financial computer application for the customer financial account responsive to said verifying by the back end component.