Loyalty Point Transfer System Using Location Verification
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Solution Overview
Problem
Users face difficulties in transferring loyalty currencies due to restrictions imposed by issuers, such as expiration, limited usage categories, and inability to exchange points between individuals, leading to unredeemed values and inefficient use of rewards.
Innovation Solution
A system and method that enables secure, location-based transfer of loyalty points between mobile devices, using a server with a processor to facilitate requests, identify service providers, establish secure communications, and utilize loyalty points for service procurement, allowing users to exchange points without issuer restrictions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If loyalty currency issuers impose restrictions on transfer and usage, then control over currency value is maintained, but user ability to exchange and utilize points is limited
Solution Approach 1:
The patent introduces a peer-to-peer exchange platform that acts as an intermediary, allowing users to transfer loyalty points directly to each other without requiring issuer approval. The system mediates these transfers by verifying user identities, monitoring transactions, and ensuring compliance with anti-money laundering regulations, thereby enabling point exchange while maintaining system control.
Solution Approach 2:
The system segments the loyalty currency ecosystem into issuer-controlled portions (where rules apply) and user-controlled portions (where peer-to-peer transfers occur). By dividing the transfer mechanism into discrete, trackable transactions between individual users, the system enables flexibility while maintaining oversight through the platform's monitoring and verification infrastructure.
2Adaptability or versatility
If peer-to-peer transfer of loyalty points is enabled, then user flexibility and exchange capability are improved, but system security and control may be compromised
Solution Approach 1:
The system implements continuous feedback loops through transaction monitoring, user verification, and compliance checking. Each peer-to-peer transfer triggers automated verification processes that check user identities, validate transaction purposes, and report suspicious activities to authorities, ensuring security while enabling flexibility.
Solution Approach 2:
The system performs preliminary actions by requiring user registration, identity verification, and account setup before enabling peer-to-peer transfers. These advance preparations establish security protocols and user credentials that prevent unauthorized transfers and ensure compliance with regulations before any point exchange occurs.
3Reliability
If issuer restrictions on loyalty currency usage are maintained, then currency value control is preserved, but redemption opportunities and user satisfaction decrease
Solution Approach 1:
The patent adds a new dimension to loyalty currency utilization by enabling horizontal peer-to-peer transfers between users, complementing the traditional vertical issuer-to-user redemption path. This additional dimension allows points to be exchanged for services or goods that issuers don't directly provide, increasing redemption opportunities while maintaining issuer control over their own reward programs.
Data Source
AI summary
There are provided systems and methods for the location-based secured transfer of a service associated with a loyalty point between mobile devices. A first mobile device submits a services request to a central system, the request identifying a service and inclusive of the position (geographical location) of the first mobile device. The central system identifies service providers capable of fulfilling the request and account owners having sufficient loyalty points to fulfill the request that are in proximity to the first mobile device. Secure communications between the first mobile device and a second mobile device enable negotiations. The central system guides the first mobile device and the second mobile device to a predetermined location to enable secure communication of transaction information, payment information, personal information (needed to procure services), etc. The central system verifies the transaction, ensuring both the first and second mobile devices fulfill the agreed upon terms.