Payer-Controlled Digital Transactions Without Merchant Card Data
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Solution Overview
Problem
Existing electronic payment systems are vulnerable to data theft, as credit/debit card information is transmitted to merchants, exposing it to potential theft and requiring merchants to comply with stringent security measures.
Innovation Solution
A distributed payer-controlled payment architecture involving a payer device, merchant device, and authorization server, where sensitive data is never transmitted to the merchant, using encrypted messages and a VPN for secure communication, with the authorization server validating transactions and sending approval codes.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Productivity
If credit/debit card information is transmitted to merchants for electronic payments, then payment transactions can be completed, but the system becomes vulnerable to data theft and requires stringent security compliance
Solution Approach 1:
The patent extracts sensitive card information from the transaction data flow entirely. Instead of transmitting card numbers to merchants, the system uses tokenization where card data is replaced with non-sensitive tokens. The merchant only receives and processes tokenized transaction data, completely removing sensitive information from the payment channel while maintaining transaction functionality.
Solution Approach 2:
The patent introduces an intermediary authorization server that acts as a trusted third party between the payer and merchant. This server receives transaction requests, validates tokens, and processes payments without exposing card data to merchants. The intermediary enables secure transactions by mediating the authentication and payment processes while keeping sensitive data confined to secure channels.
2Ease of operation
If merchants store and process credit/debit card information, then payment processing is enabled, but compliance burdens and security requirements increase significantly
Solution Approach 1:
The patent removes the burden of handling sensitive data from merchants by extracting card information processing from their systems entirely. Merchants only interact with tokenized data and authorization responses, eliminating the need for PCI DSS compliance, secure storage infrastructure, and complex security protocols while maintaining full payment processing capability.
Solution Approach 2:
The system enables merchants to process payments securely without requiring them to implement complex security measures. The authorization server and tokenization system automatically handle security requirements, allowing merchants to simply integrate payment processing functionality without becoming security experts or maintaining secure card data environments.
3Reliability
If sensitive payer information is shared with merchants, then personalized service and accurate billing are achieved, but fraud risk and data security vulnerabilities increase
Solution Approach 1:
The patent creates a functional copy of card information in the form of tokens that replicate the authentication and transaction capabilities of actual card data without containing sensitive information. These tokens enable accurate billing and personalized service by uniquely identifying payers and authorizing transactions, while being useless for fraud purposes since they cannot be reverse-engineered to reveal original card data.
Data Source
AI summary
Herein disclosed are location-agnostic secure payer controlled digital transaction systems and methods wherein in response to a registered merchant device receiving, during a transaction phase, a digital indication comprising purchase offer information, encoding the purchase offer information in a QR code, exporting the QR code to an image, sending the image with a digital indication configured to cause an advertising system to strategically place the image in advertising content, and in response to a registered payer device scanning the QR code image from the advertising content, the merchant device receiving an authorization response from an authorization server for a completed transaction for the purchase offer. The product offer information may comprise a merchant ID, product information, a purchase price and a merchant ad identifier. The payer device may receive payer approval for the purchase offer. The merchant and payer devices previously registered with the authorization server during a registration phase.