Partial Authorization Messaging for POS Card Activation

Resolve Bottlenecks,
Find Innovative SolutionsGenerate Solutions

Solution Overview

Problem

Existing systems for activating and reloading debit-type and prepaid cards are costly and inflexible, requiring significant software upgrades and interrupting normal register operations, while also introducing delays and risks in settling activation funds.

Innovation Solution

A system that allows activation of gift and prepaid cards via a merchant's point-of-sale (POS) system without significant software upgrades, using existing POS communication networks and enabling direct settlement between the merchant and issuer, utilizing partial-authorization messaging to manage transaction card activation and processing.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Reliability

If traditional closed systems with dedicated activation terminals are used, then card activation can be performed, but the system becomes expensive to implement and requires significant space

Engineering Contradiction:

Improvecard activation capabilityVSAvoidsystem implementation cost and space requirement

Core Design Contradiction:

ReliabilityVSDevice complexity

Solution Approach 1:

The patent enables existing multi-application POS terminals to handle both traditional open systems payment processing and closed systems card activation functions. The terminal can switch between different card issuers and processing modes without requiring dedicated activation hardware, making the POS terminal universal for both payment and activation purposes.

Inventive Principle:

Principle #6Universality (Multi-functionality)

Solution Approach 2:

The patent combines the card activation function with the existing POS terminal infrastructure. Instead of separate dedicated activation terminals, the activation capability is merged into the POS system that merchants already have for processing payments, eliminating the need for additional standalone equipment.

Inventive Principle:

Principle #5Merging (Combining)

2Reliability

If closed system activation terminals are deployed, then card activation is enabled, but the merchant's ability to switch between different card issuers is limited

Engineering Contradiction:

Improvecard activation functionVSAvoidmerchant's ability to switch card issuers

Core Design Contradiction:

ReliabilityVSAdaptability or versatility

Solution Approach 1:

The POS terminal is configured to support multiple card issuers and processing modes. It can handle traditional open systems networks (Visa, MasterCard, etc.) and closed systems activation simultaneously, allowing the merchant to accept cards from different issuers and switch between processing modes as needed.

Inventive Principle:

Principle #6Universality (Multi-functionality)

Solution Approach 2:

The system allows dynamic switching between different card issuers and processing modes. The POS terminal can adapt its configuration based on which card issuer is being used, enabling flexible transitions between open and closed systems processing without hardware changes.

Inventive Principle:

Principle #15Dynamics

3Adaptability or versatility

If software upgrades are performed on POS systems, then new card processing capabilities are added, but normal register operations are interrupted and significant time is required

Engineering Contradiction:

Improvecard processing capabilityVSAvoidregister operation continuity

Core Design Contradiction:

Adaptability or versatilityVSProductivity

Solution Approach 1:

The system is pre-configured with the necessary software and communication protocols to support both open and closed systems processing. The POS terminal is prepared in advance to handle card activation messages through existing payment networks, eliminating the need for disruptive upgrades when new card types are introduced.

Inventive Principle:

Principle #10Preliminary action

Solution Approach 2:

The existing POS terminal software is designed to be multi-functional, capable of handling both traditional payment processing and card activation through the same interface. This eliminates the need for separate software installations or system interruptions to add new card processing capabilities.

Inventive Principle:

Principle #6Universality (Multi-functionality)

4Ease of operation

If traditional debit card processing through interbank networks is used, then card purchases can be processed, but settlement delays and risks in accessing customer funds occur

Engineering Contradiction:

Improvecard purchase processingVSAvoidsettlement delay

Core Design Contradiction:

Ease of operationVSLoss of time

Solution Approach 1:

The patent uses existing payment network infrastructure as an intermediary to transmit activation messages between the merchant's POS system and the card issuer. This intermediary system enables direct, real-time communication for fund settlement, eliminating delays associated with traditional batch processing through interbank networks.

Inventive Principle:

Principle #24Intermediary (Mediator)

Data Source

PatentUS9508067B2System, program product and methods for retail activation and reload associated with partial authorization transactions

Publication Date: 2016.11.29 PATHWARD NAT ASSOC

AI summary

Systems, program product, apparatus and method for transmitting and processing the sale of a transaction card product over an existing payment network using partial authorization messaging, are provided. An example of such a system can include a merchant POS apparatus equipped to support partial authorization messaging, a transaction card issuer server in communication therewith, and a transaction card product. The transaction card product can include a conventional transaction card securely wrapped within a tamper evident container that can carry its own magnetic strip. The container magnetic strip can store an assigned unique card identifier linked to, but different from, the card identifier normally associated with the card. The container card identifier stored in the container magnetic strip is compatible with the merchant POS card reader and is usable to activate the card without the merchant or consumer having access to the card, the card identifier, or the card magnetic strip.