Merchant Payment Tokenization With Remote Key Isolation
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Solution Overview
Problem
Merchants face significant security risks and compliance challenges due to the handling and storage of sensitive payment information (PCI data) on their systems, despite tokenization methods, which still expose them to data breaches and fines.
Innovation Solution
Implementing a tokenization system where sensitive payment information is processed by an external tokenization service provider (TSP), ensuring that only encrypted data is stored on the merchant's system, and the decryption key is maintained remotely, thereby reducing the risk of data breaches and achieving Payment Card Industry (PCI) compliance.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If merchants store and process sensitive payment information (PCI data) on their systems, then they can process payments directly, but they are exposed to data breaches and face compliance fines
Solution Approach 1:
The patent extracts the sensitive PCI data storage and decryption functions from the merchant's system and places them in a dedicated secure payment processing system. The merchant system only stores tokenized representations of card data, while the actual sensitive data is held in encrypted form in the secure payment processing system, which is compliant with PCI DSS standards. This separation removes the harmful exposure of merchants to data breaches while preserving payment processing capability.
Solution Approach 2:
The patent introduces a tokenization intermediary that replaces sensitive card data with non-sensitive tokens. These tokens can be stored and processed by merchants without exposing them to PCI compliance requirements. The intermediary translation layer allows merchants to process payments using tokens while the actual card data remains protected in the secure payment processing system, thus resolving the contradiction between processing capability and security exposure.
2Object-affected harmful factors
If merchants implement traditional tokenization methods, then they reduce some security risks, but they still maintain decryption keys and exposed PCI data on their systems
Solution Approach 1:
The patent extracts the decryption key management and sensitive data storage from the merchant system entirely. Instead of merchants holding decryption keys as in traditional tokenization, the secure payment processing system maintains exclusive control over encrypted card data and decryption capabilities. This complete extraction ensures merchants cannot accidentally expose PCI data even during system breaches, while the secure system maintains compliance security through centralized controlled access.
3Object-affected harmful factors
If merchants use external tokenization service providers, then they reduce data breach risk, but they increase system complexity and require additional integration
Solution Approach 1:
The patent merges the tokenization service, secure data storage, and payment processing functions into a unified secure payment processing system. Rather than requiring separate tokenization services and manual integration, the system combines these functions internally with standardized interfaces. This reduces the effective complexity for merchants while maintaining the security benefits of externalized sensitive data handling, as the merged system presents a simplified interface despite internal complexity.
Data Source
AI summary
Systems and methods for payment processing include receiving, by a payment terminal, a personal account number to complete a payment. The personal account number is encrypted by the payment terminal. The encrypted personal account number is sent from the payment terminal to a merchant server via a network. The encrypted personal account number is sent from the merchant server to a tokenization service provider server for tokenization and validation via a payment processor. The merchant server receives an indication of whether the transaction was successful and a token from the tokenization service provider server.