Payment API Portal for Secure Third-Party Identity Verification
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Solution Overview
Problem
Retailers face challenges in verifying the identity of customers during transactions, leading to potential fraudulent activities and risks associated with identity theft.
Innovation Solution
A financial institution computing system provides identity verification services through APIs, allowing customers to integrate services that facilitate secure user registration and payment processes by leveraging existing user information stored within the system, reducing the need for manual data entry and enhancing transaction security.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If the retailer collects customer personal information during profile setup, then the retailer can process purchase orders and maintain customer accounts, but the retailer cannot truly verify the customer's identity and is at risk of fraudulent transactions
Solution Approach 1:
The patent introduces a third-party identity verification service as an intermediary between the retailer and the customer. This service receives verification requests from the retailer, performs identity checks using multiple data sources, and returns verification results. This mediator resolves the contradiction by providing reliable identity verification without requiring the retailer to build complex verification systems themselves.
Solution Approach 2:
The identity verification service performs preliminary identity checks before the actual transaction occurs. By verifying customer identities in advance during the profile setup phase, the system prevents fraudulent transactions before they can happen, rather than detecting fraud after it occurs. This preliminary action ensures transaction security without adding complexity to the payment processing itself.
2Productivity
If the customer provides personal information manually during registration, then the retailer can create customer profiles, but the process is time-consuming and prone to errors
Solution Approach 1:
The system performs preliminary data collection and verification by obtaining customer information from existing accounts at financial institutions or other trusted sources before the registration process begins. This preliminary action eliminates the need for customers to manually enter information and ensures data accuracy by using pre-verified information from reliable sources.
Solution Approach 2:
The patent uses copying by retrieving and reusing customer information from existing accounts at financial institutions or other trusted sources. Instead of requiring customers to manually enter their personal information, the system copies verified data from these existing records, significantly speeding up registration while maintaining high data accuracy through the use of pre-verified information.
3Speed
If the retailer stores customer payment information locally, then transaction processing is faster, but the risk of data breaches and identity theft increases
Solution Approach 1:
The patent extracts sensitive payment information handling from the retailer's system and transfers it to specialized third-party payment processors and financial institutions. By taking out the storage and processing of sensitive financial data from the retailer's environment, the system maintains fast transaction processing through API integrations while significantly reducing the risk of data breaches and fraudulent transactions.
Solution Approach 2:
The system introduces intermediary payment processors and financial institutions between the retailer and customer payment information. These intermediaries handle the sensitive data transmission and processing, allowing fast transactions through optimized payment pipelines while the retailer never actually stores or handles the sensitive payment data, thereby reducing fraud risk.
Data Source
AI summary
A method for providing an application programming interface (API) service that enables a third-party to provide screens that allow account holders to provide credentials to an institution while bypassing the third-party, comprising transmitting an API to a third-party device for integration into a website served by the third-party, the API configured to generate a portal that accepts the credentials without revealing the credentials to the third-party; receiving, via the API integrated into the third-party website, a request for verification of a user; instructing the API integrated into the third-party website to display a screen of the institution within a window through which transmissions can be received directly from the user without the third-party receiving the transmissions; receiving, directly from the user and through the window, user credentials input into the screen without revealing the input user credentials to the third-party; and verifying the user by confirming the user credentials.