Interface Processor Automating IoT Payment Transactions
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Solution Overview
Problem
Existing systems do not enable Internet of Things (IoT) devices to initiate payment account transactions directly with acquirers associated with merchants, requiring consumers to manually handle transactions and potentially leading to inefficiencies and increased fraud risks.
Innovation Solution
Implementing an interface processor (IP) that communicates payment account transactions from IoT devices to acquirers associated with merchants, using predefined consumer rules to automate the transaction process without directly involving the merchant, thereby facilitating secure and efficient transactions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If consumers manually initiate payment transactions by presenting credentials to merchants, then the transaction process is simple and direct, but it increases fraud risks and requires continuous consumer intervention
Solution Approach 1:
The system enables IoT devices to autonomously initiate and execute payment transactions without consumer intervention. The interface processor automatically presents payment credentials to acquirers when transactions are required, allowing the system to serve itself rather than requiring manual consumer action for each transaction
Solution Approach 2:
The interface processor acts as an intermediary between IoT devices and acquirers. It securely manages payment credentials and handles the authentication process, mediating between the device needing resources and the payment system, thereby reducing direct exposure of credentials and lowering fraud risk
2Productivity
If IoT devices directly communicate payment credentials to merchants, then the transaction process is straightforward, but it exposes credentials to potential fraud and security risks
Solution Approach 1:
The interface processor serves as a secure intermediary that receives transaction requests from IoT devices and communicates with acquirers using stored payment credentials. This intermediary architecture maintains transaction efficiency while preventing direct exposure of credentials to merchants, thereby reducing fraud risk
Solution Approach 2:
The system extracts the sensitive payment credential handling function from the merchant interaction process and places it within the controlled environment of the interface processor. By separating credential presentation from merchant communication, the system maintains productivity while mitigating fraud risks associated with credential exposure
3Productivity
If consumers manually handle each payment transaction, then full control over spending is maintained, but the process becomes time-consuming and inefficient
Solution Approach 1:
The system enables autonomous self-service transactions where IoT devices automatically initiate payments when resources are needed. The interface processor handles credential presentation and authentication without requiring consumer time or intervention, dramatically improving transaction speed while eliminating time loss from manual handling
Solution Approach 2:
Payment credentials are pre-configured and securely stored in the interface processor before transactions occur. This preliminary setup allows immediate execution of transactions without requiring consumers to manually input credentials at the time of purchase, thereby increasing productivity while minimizing time loss
Data Source
AI summary
Disclosed are exemplary embodiments of systems and methods for facilitating payment account transactions to acquirers, based on purchase requests by Internet of Things (IoT) devices. In an exemplary embodiment, a method generally includes receiving, by an interface processor, a message from an IoT device at a premises where the message includes a condition related to the IoT device, and determining, by the interface processor, based on at least one rule in memory, whether to initiate a transaction at a merchant to purchase a product and/or a related product based on the condition. The method then further includes transmitting to an acquirer associated with the merchant, by the interface processor, rather than to the merchant, an authorization request for the transaction for the product and/or the related product when the condition satisfies the at least one rule.