Open Banking BNPL Offer Flow for KYC and Consent Sharing
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Solution Overview
Problem
Existing installment loan providers face challenges in satisfying Know Your Customer (KYC) requirements and opening new accounts for consumers due to the increasing number of participants in Buy Now, Pay Later (BNPL) programs, making it difficult to manage consumer data and offer personalized loan options efficiently.
Innovation Solution
A system leveraging open banking infrastructure to access consumer data through validated account credentials, retrieve installment loan offers based on preferences, and share consent information with IPPs, facilitating streamlined BNPL transactions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If traditional KYC verification methods are used for each installment program provider, then consumer data security and compliance are maintained, but the account opening process becomes increasingly complex and time-consuming as more providers participate
Solution Approach 1:
The patent introduces an open banking intermediary system that acts as a mediator between consumers and multiple installment program providers. This intermediary verifies consumer credentials once and shares verified data with multiple providers through standardized APIs, eliminating the need for each provider to independently verify the same consumer data. This resolves the contradiction by maintaining KYC compliance through the intermediary while simplifying the account opening process for consumers dealing with multiple providers.
Solution Approach 2:
The system performs preliminary KYC verification and consumer authentication before the consumer interacts with multiple installment program providers. By completing the verification process in advance through the open banking intermediary, the system eliminates redundant verification steps when consumers apply with different providers, thereby maintaining security compliance while reducing the complexity and time required for each subsequent account opening.
2Adaptability or versatility
If multiple installment program providers participate in BNPL programs, then consumer loan options and personalization improve, but it becomes difficult to manage and retrieve consumer data efficiently
Solution Approach 1:
The patent implements a universal open banking data management system that serves multiple installment program providers through standardized interfaces and APIs. This system can retrieve, store, and manage consumer data for numerous providers simultaneously using a single unified platform, eliminating the need for each provider to maintain separate data management infrastructure. This resolves the contradiction by providing diverse loan options through multiple providers while maintaining high data management efficiency through the universal system.
Solution Approach 2:
The system creates standardized data copies and representations of consumer information that can be efficiently shared across multiple installment program providers. By using standardized data formats and API-based copying mechanisms, the system enables multiple providers to access necessary consumer data without requiring direct connections to each consumer's bank accounts, thereby improving both the versatility of loan options and the efficiency of data retrieval.
3Adaptability or versatility
If consumer data is shared with multiple installment program providers, then personalized loan offers can be provided, but data security and consumer consent management become more challenging
Solution Approach 1:
The patent implements a feedback mechanism where consumer consent preferences are captured once and then communicated to multiple installment program providers through the open banking intermediary. The system continuously monitors and updates consent status, ensuring that data is only shared when explicitly authorized by the consumer. This resolves the contradiction by enabling personalized loan offers through data sharing while maintaining data security through ongoing consent verification and consumer control.
Solution Approach 2:
The open banking intermediary serves as a secure mediator that controls and manages data sharing between consumers and multiple installment program providers. It implements security protocols, verifies consumer consent, and regulates data access while enabling personalized loan offers. This intermediary layer maintains data security by ensuring that only authorized data is shared with providers who have legitimate business needs, thereby resolving the contradiction between personalized offers and data security.
Data Source
AI summary
Methods and systems for leveraging open banking to include installment payment offerings include receiving a request message for an installment loan offer. The request message is associated with a transaction being performed by a consumer. The request message includes account access credentials associated with an open banking installment offer service account and transaction details associated with the transaction. The account access credentials are validated and the open banking installment offer service account is accessed. One or more installment loan offers are retrieved based on consumer preferences associated with the open banking installment offer service account. The installment loan offers are transmitted to the computer associated with the merchant. A consent message including consumer consent information indicating consent to share open banking data with one or more installment program providers (IPPs) is received. The open banking data is associated with the consumer.