Merchant-Issuer Dynamic Passcode Exchange for Frictionless Payment MFA
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Solution Overview
Problem
Existing multi-factor authentication (MFA) methods for electronic payments increase the number of steps and communications required for transactions, leading to friction and inefficiency.
Innovation Solution
A system and method for dynamic passcode communication between a merchant and issuer application on a user device, where the merchant application determines the presence of the issuer application, requests a dynamic passcode, and sends an authorization request with the passcode to the issuer system, reducing the number of steps and communications.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If multi-factor authentication is implemented for electronic payments, then security is improved, but the number of steps and communications required increases
Solution Approach 1:
The patent combines the authentication factors by having the issuer application generate a dynamic passcode that is automatically transmitted to the merchant application through a unified communication channel. This merging of passcode generation and transmission into a single integrated process reduces the number of separate steps and communications required while maintaining security.
Solution Approach 2:
The communication between the issuer application and merchant application serves as an intermediary mechanism that automatically handles the dynamic passcode exchange. This intermediary process eliminates the need for manual authentication steps and reduces direct communications between the user and multiple systems, thereby simplifying the overall authentication flow.
2Reliability
If dynamic passcode is transmitted between applications on user device, then authentication security is improved, but application complexity increases
Solution Approach 1:
The issuer application automatically generates and transmits the dynamic passcode without requiring user intervention. The system performs self-service authentication by having the issuer application directly communicate the passcode to the merchant application, thereby improving security while avoiding the complexity that would arise from manual user actions.
Solution Approach 2:
The dynamic passcode is generated in advance by the issuer application before the actual transaction authorization is needed. This preliminary generation of the authentication credential allows the system to have the security measure ready beforehand, simplifying the real-time authentication process and reducing the complexity of on-the-fly passcode generation.
Data Source
AI summary
Systems, methods, and computer program products for dynamic passcode communication use a merchant application installed on a user device that receives transaction data associated with a transaction at a merchant system. The transaction data may include an account identifier associated with an account at an issuer system. The merchant application determines, based on the account identifier, whether an issuer application associated with the issuer system is installed on the user device. In response to determining that the issuer application is installed on the user device, the merchant application transmits, to the issuer application, a request for a dynamic passcode. The merchant application receives, from the issuer application, the dynamic passcode and transmits, to the issuer system, an authorization request including the account identifier and the dynamic passcode. The merchant application receives, from the issuer system, an authorization response authorizing or denying the transaction.