Payment Network Promotion Code Application System
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Solution Overview
Problem
The payment card industry faces challenges in efficiently managing special or customized issuer-merchant relationships, particularly in applying promotion codes and rewards programs to payment transactions over a bankcard network, as existing systems require direct communication and complex back-office processes.
Innovation Solution
A network-based system that allows cardholders to input and apply promotion codes to payment transactions using a database and server system, which stores and processes promotional data, enabling cardholders to select and apply promotional programs offered by merchants, thereby streamlining transaction processing and eliminating the need for direct issuer-merchant connectivity.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If direct communication between issuers and merchants is used for transaction authorization and clearing, then special or customized issuer-merchant relationships can be managed, but device complexity and back office processing requirements increase
Solution Approach 1:
The patent introduces a payment card network as an intermediary that enables special issuer-merchant relationships without requiring direct communication between them. The network facilitates transaction routing, authorization, and clearing through its existing infrastructure, eliminating the need for complex direct back office connections while maintaining special relationship capabilities.
2Device complexity
If legacy general purpose bankcard infrastructure is used to support special relationships, then transaction routing and financial settlement are simplified, but the ability to apply customized promotion codes and rewards programs is limited
Solution Approach 1:
The patent makes the bankcard network infrastructure dynamic by enabling it to handle both general purpose transactions and specialized promotion code applications through the same system. The network can adapt its processing to apply customized promotion codes and rewards programs while maintaining the simplicity of legacy infrastructure for routine transaction routing and settlement.
3Reliability
If issuers maintain back office processes to manage special relationships, then customized issuer-merchant relationships can be enforced, but productivity and transaction processing efficiency decrease
Solution Approach 1:
The patent enables the payment card network to self-service special relationship management by using its existing authorization and clearing infrastructure to handle promotion codes and rewards programs. This eliminates the need for issuers to maintain separate back office processes, thereby improving transaction processing efficiency while still enforcing customized relationships.
4Reliability
If Merchant Acquirers are used to facilitate indirect communications with merchants, then issuer-merchant connectivity is established, but loss of information and processing complexity increase
Solution Approach 1:
The patent makes the payment card network universal by enabling it to perform multiple functions: general purpose transaction processing, special relationship management, promotion code application, and rewards program enforcement. This multi-functionality eliminates the need for separate Merchant Acquirer intermediaries, reducing information loss and processing complexity while maintaining issuer-merchant connectivity.
Data Source
AI summary
A method for applying promotion codes to a payment transaction is provided. The method uses at least one input device in communication with a database. The payment transaction includes a purchase made by a cardholder using a payment card over a payment card network. The method includes storing promotion data within the database including at least one merchant participating in the payment card network, each promotional program offered by the at least one merchant to the cardholder, and promotion codes associated with each promotional program offered to the cardholder. The method further includes accessing the promotion data using the at least one input device, receiving a selected promotional program from the cardholder using the at least one input device, and automatically applying the promotion codes associated with the selected promotional program to the payment transaction.