Parallel Fund Transfer System for High-Volume Transaction Processing
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Solution Overview
Problem
Existing inter-institution transaction systems face limitations in processing a high volume of financial transactions, leading to system overloading, delays, and increased liquidity and credit risks for institutions.
Innovation Solution
Implementing a parallel fund transfer system by creating multiple threads that operate in parallel, each replicating a single fund transfer system, and dynamically assigning institutions and transactions to these threads to optimize processing capacity and liquidity allocation.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If a single fund transfer system operates in real-time gross settlement, then transactions are settled immediately and irrevocably, but the system can process only a limited number of transactions per second and becomes overloaded when transaction volume exceeds this limit
Solution Approach 1:
The patent divides the single fund transfer system into multiple parallel threads (e.g., Thread 1, Thread 2, Thread 3), each capable of independently processing transactions. This segmentation allows the system to handle multiple transactions simultaneously across different threads, thereby increasing overall transaction processing capacity while maintaining settlement finality in each thread.
Solution Approach 2:
The patent introduces a new dimension of parallelism by operating multiple fund transfer systems simultaneously in parallel rather than sequentially. Each thread represents a separate execution path that can process transactions independently, effectively adding a temporal and spatial dimension to transaction processing capacity.
2Productivity
If the system processes a high volume of transactions, then transaction throughput increases, but system overloading occurs leading to delays and increased liquidity risk for institutions
Solution Approach 1:
By segmenting the transaction flow across multiple parallel threads, the system distributes the processing load evenly. Each thread handles a subset of transactions, preventing any single thread from becoming overloaded. This segmentation maintains transaction throughput while reducing the risk of delays and liquidity risks associated with system overloading.
Solution Approach 2:
The patent changes the system parameter from a single-threaded architecture to a multi-threaded architecture, fundamentally altering the processing capacity and load distribution characteristics. This parameter change enables the system to scale transaction throughput linearly with the number of threads while maintaining reliability through distributed load handling.
3Productivity
If deferred net settlement systems are used, then credit risk for institutions increases, but the system can handle higher transaction volumes through netting cycles
Solution Approach 1:
The patent creates multiple copies of the real-time gross settlement system in parallel threads, each maintaining the same settlement finality and risk control characteristics. Instead of using deferred net settlement, the system copies the RTGS model across multiple threads, preserving the low credit risk advantage while achieving high transaction volume capacity through parallel processing.
Data Source
AI summary
Disclosed is a method of establishing and managing an inter-institution transaction system. The method comprises creating plurality of threads to constitute parallel fund transfer system, wherein each thread is a replica of single fund transfer system, and wherein plurality of threads are to be operated in parallel; assigning plurality of institutions to plurality of threads, wherein a given institution is assigned as a sending institution and/or a receiving institution of a financial transaction to at least one thread, and a given thread has at least one sending institution-receiving institution pair assigned thereto; assigning financial transactions to plurality of threads based at least on sending institution-receiving institution pairs assigned to plurality of threads; and processing financial transactions at their corresponding threads.