Payment Card-Based Transaction System for Lease-to-Own Fraud Protection
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Solution Overview
Problem
Current systems for funds disbursement in lease-to-own transactions are inefficient due to the need for manual intervention, reconciliation challenges, and fraud prevention measures, which complicate relationships between lease-to-own companies and retailers, and hinder the smooth execution of multiparty transactions.
Innovation Solution
A payment card-based system using a mobile device that allows consumers to initiate payments for lease-to-own arrangements, where the mobile device communicates with a remote computing platform to evaluate suitability and authorize payments, reducing the need for manual intervention and enabling secure, efficient transactions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If the lease-to-own company aggregates sums and initiates lump-sum wire transactions to the retailer, then fraud protection is improved, but the difficulty of reconciling payment with underlying sales transactions increases
Solution Approach 1:
The patent segments the lump-sum wire transaction into individual authorized payment transactions, each linked to specific lease-to-own agreements. This allows the system to maintain fraud protection through centralized control while enabling easy reconciliation by matching each segmented payment to its underlying sales transaction through unique transaction identifiers and linked account records.
2Ease of operation
If the lease-to-own company provides a payment tool to the consumer, then ease of operation is improved, but the risk of fraud increases
Solution Approach 1:
The patent introduces an intermediary payment card system that acts as a mediator between the consumer and the retailer. The payment card is pre-loaded with funds from the lease-to-own company and can only be used for authorized transactions. This intermediary mechanism allows consumers to initiate payments conveniently while the system maintains fraud protection through authorization controls and monitoring of the payment card activity.
3Reliability
If manual intervention is used in the payment process, then transaction integrity is improved, but productivity decreases
Solution Approach 1:
The patent implements a self-service payment system where the payment card automatically handles transaction authorization and processing. The system automatically matches payments to underlying transactions, calculates amounts, and manages the payment flow without requiring manual intervention. This self-service mechanism maintains transaction integrity through automated authorization controls while significantly improving productivity by eliminating manual processing steps.
4Reliability
If pre-existing relationships between retailers and lease-to-own companies are required, then transaction integrity is improved, but adaptability decreases
Solution Approach 1:
The patent creates a universal payment card system that can be used across multiple retailers without requiring pre-existing relationships. The payment card serves multiple functions: it provides fraud protection, enables automatic payment matching, and works with any retailer that accepts the card. This universal mechanism maintains transaction integrity through standardized authorization protocols while greatly improving adaptability by allowing lease-to-own companies to work with any retailer in the network.
Data Source
AI summary
In an illustrative embodiment, systems and methods by which a mobile device accessible by a consumer may be used to cooperate with a remote computing platform operated by a lease-to-own or subscription company to initiate a payment for an item that is the subject of a lease-to-own or subscription arrangement between the consumer and the lease-to-own or subscription company. The mobile device executes an app that permits the user to acquire information about the item, including information identifying the item, and according to some embodiments, a price of the item. The mobile device and the remote computing platform cooperate to form an agreement concerning an arrangement concerning the item. The mobile device stores a payment card in an onboard secure element. The remote platform defines criteria permitting an authorization request pertaining to the payment card as used to pay for the item in connection with the arrangement to be approved.