Funding Source Proxy for Tokenized Payment Transaction Tracking
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Solution Overview
Problem
In traditional card payment models, the introduction of secondary payment devices like key fobs and mobile devices using tokenized PANs disrupts the one-to-one correspondence between the primary account number and the funding account, making it difficult for merchants to identify that multiple transactions are funded from the same account, leading to potential abuse and unscrupulous use.
Innovation Solution
A method is introduced where a funding source proxy (FSP) is generated from the funding primary account number (FPAN) on the payment terminal, allowing it to be used to identify, authorize, or block transactions, and added to a deny list if necessary, ensuring that only one transaction per account is allowed after a declined authorization.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If tokenised PANs (DPAN) are used on secondary payment devices, then security is improved, but the ability to identify the funding source is lost
Solution Approach 1:
The patent introduces a Funding Source Proxy (FSP) as an intermediary element that bridges the gap between tokenized DPANs and the original FPAN. The FSP is derived from the FPAN using a predetermined algorithm and is stored on the secondary payment device alongside the DPAN. This intermediary allows the terminal to identify the funding source without exposing the actual FPAN, thus maintaining security while enabling funding source identification.
2Adaptability or versatility
If multiple secondary payment devices use different DPANs from the same FPAN, then device versatility is improved, but transaction tracking accuracy deteriorates
Solution Approach 1:
The patent enables a single FPAN to be associated with multiple DPANs across different secondary payment devices, making the system universal. Each device can independently use its own DPAN for transactions while the FSP ensures they are all tracked back to the same funding source. This allows users to have multiple devices (smartphone, tablet, smartwatch, key fob) all functioning as payment devices from the same account.
3Ease of operation
If merchants process transactions using DPANs without FSP verification, then ease of operation is improved, but abuse prevention capability deteriorates
Solution Approach 1:
The patent implements preliminary action by requiring the terminal to generate or retrieve the FSP and check it against the deny list before processing the transaction. This pre-transaction check prevents abuse by identifying and blocking attempts to circumvent declined authorizations through alternative devices, while the process is automated enough to not significantly complicate the user experience.
Data Source
AI summary
According to a first aspect there is provided a method of identifying the funding source of an electronic transaction, said method comprising a payment terminal: receiving a transaction request comprising one or more credentials from a payment device; and determining whether said credentials comprise a funding source proxy (FSP) and, if not, generating the FSP from one or more of said credentials according to a predetermined algorithm stored on said payment terminal; wherein the funding source proxy is derived from a funding primary account number (FPAN) of a funding source of said payment device. Other aspects provide a method of blocking an electronic transaction, a method of authorising an electronic transaction, a method performed by a payment terminal and a method of provisioning a device with payment capability.