Network Traffic Resource Codes for Low-Integration BNPL
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Solution Overview
Problem
Existing systems for implementing buy-now-pay-later (BNPL) options at point of sale (POS) devices are inefficient and require significant technical integration beyond the capabilities of merchants, leading to integration challenges.
Innovation Solution
A network-based system that utilizes network traffic to manage BNPL options by including a resource code in authorization messaging, determining eligibility through a ledger data structure, and imposing installment terms during transaction clearing, minimizing the need for direct integration at merchant or financial institution systems.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If BNPL options are integrated directly at POS devices and merchant systems, then BNPL functionality can be implemented, but technical complexity and integration difficulty increase significantly
Solution Approach 1:
The patent introduces an intermediary system that acts as a mediator between merchants and financial institutions. This intermediary handles the complex BNPL logic, resource code generation, and installment term management centrally, allowing merchants to offer BNPL without direct integration to financial institutions. The intermediary translates merchant requests into standardized authorization messages with resource codes that financial institutions process according to pre-configured rules.
Solution Approach 2:
The patent extracts the complex BNPL processing logic from merchant systems and financial institution direct integrations, and places it in a centralized intermediary system. By taking out the complex installment term determination, resource code assignment, and eligibility verification logic from the edges (merchants) and concentrating it in the center (intermediary), the system reduces integration complexity at merchant premises while maintaining BNPL functionality.
2Reliability
If comprehensive BNPL integration is implemented at financial institutions, then installment terms can be enforced, but implementation difficulty and technical requirements increase
Solution Approach 1:
The patent implements preliminary action by pre-configuring financial institutions with rules for processing resource codes and determining installment terms. Before actual BNPL transactions occur, the system establishes authorization messages with embedded resource codes that contain all necessary information for installment term determination. Financial institutions receive these pre-packaged authorization requests with resource codes, eliminating the need for complex real-time negotiations or additional integration logic at the financial institution level.
Solution Approach 2:
The patent changes the parameter structure of authorization messages by embedding resource codes that encode installment terms and eligibility criteria. Instead of requiring financial institutions to process complex installment agreements and term negotiations, the system transforms the authorization message parameters to include standardized resource codes that financial institutions can process using pre-configured rules, simplifying their implementation while maintaining reliable term enforcement.
3Adaptability or versatility
If existing infrastructure is used without modification, then system stability is maintained, but BNPL functionality cannot be implemented
Solution Approach 1:
The patent implements universality by designing the intermediary system to work with existing authorization message formats and financial institution interfaces without requiring specialized BNPL infrastructure. The system uses standard authorization messages with added resource code parameters, allowing existing card processing networks and financial institution systems to handle BNPL transactions alongside traditional transactions. This multi-functional approach enables the same infrastructure to support both traditional payments and BNPL installment options.
Solution Approach 2:
The patent applies partial action by making minimal modifications to existing authorization message formats by adding resource code parameters. Rather than completely redesigning the payment infrastructure, the system adds the necessary BNPL functionality through partial modifications to message structures. This allows the majority of existing infrastructure to remain unchanged while still enabling BNPL capability through targeted additions of resource code handling and processing logic.
Data Source
AI summary
Systems and methods are provided for managing network traffic. One example method includes receiving an authorization message for a network transaction, the authorization message including a merchant ID (MID), an interbank card association (ICA) number, and a primary account number (PAN) for an account of a user; determining, by the installment host computing device, whether the MID and ICA are registered for installments; in response to determining that the MID and ICA are registered for installments: determining whether the PAN is an installment PAN; and in response to determining that the PAN is the installment PAN: determining a resource code based on the authorization message; appending the resource code to the authorization message; and forwarding the authorization message including the resource code to an issuer of the account.