Payment Instrument PAN Segmentation for Fraud-Resistant Reissuance

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Solution Overview

Problem

Credit cards, both physical and digital, are vulnerable to fraud due to the ease of obtaining primary account numbers (PANs), which can be exploited for fraudulent transactions.

Innovation Solution

Issuing a numberless physical financial instrument with a first PAN stored in a chip for in-person transactions and a separate digital financial instrument with a second PAN for electronic transactions, with synchronized personal identification numbers (PINs), and reissuing instruments with new PANs upon loss or compromise while keeping unchanged PANs for secure management.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Ease of operation

If a single PAN is used on both physical and digital financial instruments, then ease of operation is improved, but security deteriorates due to increased fraud risk

Engineering Contradiction:

Improveease of operationVSAvoidsecurity

Core Design Contradiction:

Ease of operationVSReliability

Solution Approach 1:

The patent divides the PAN into separate instances: a first PAN for physical financial instruments and a second PAN for digital financial instruments. This segmentation isolates the sensitive data, so that compromise of one does not affect the other, thereby maintaining security while preserving ease of operation through separate dedicated PANs for each instrument type.

Inventive Principle:

Principle #1Segmentation

Solution Approach 2:

The patent creates separate copies of the PAN for different instrument types rather than using a single master copy. The first PAN is stored on the physical card chip, and the second PAN is associated with digital wallets, allowing each environment to have its own optimized PAN copy without exposing the other to fraud risks.

Inventive Principle:

Principle #26Copying

2Adaptability or versatility

If PANs are exposed on multiple financial instruments, then versatility is improved, but security deteriorates due to expanded attack surface

Engineering Contradiction:

ImproveversatilityVSAvoidfraud risk

Core Design Contradiction:

Adaptability or versatilityVSObject-affected harmful factors

Solution Approach 1:

The patent segments the PAN exposure by creating separate PANs for physical and digital instruments. The first PAN is restricted to physical card transactions while the second PAN is used for digital wallet transactions, limiting the attack surface for each PAN to specific transaction channels and reducing overall fraud risk.

Inventive Principle:

Principle #1Segmentation

Solution Approach 2:

The patent applies local quality by assigning different PANs to different instrument types with specific functional characteristics. The first PAN is optimized for physical card environments while the second PAN is optimized for digital environments, allowing each PAN to have the security properties appropriate to its specific usage context.

Inventive Principle:

Principle #3Local quality

3Reliability

If reissuance of financial instruments is required upon loss, then security is improved, but loss of time increases due to reissuance processing

Engineering Contradiction:

ImprovesecurityVSAvoidreissuance processing time

Core Design Contradiction:

ReliabilityVSLoss of time

Solution Approach 1:

The patent implements preliminary action by maintaining separate PANs for physical and digital instruments, allowing the system to quickly identify which PAN needs reissuance based on the loss notification. The separate PAN structure enables parallel processing of reissuance requests and reduces the time required to generate new PANs since the template and structure are pre-established.

Inventive Principle:

Principle #10Preliminary action

4Reliability

If separate PANs are used for physical and digital instruments, then security is improved, but device complexity increases

Engineering Contradiction:

ImprovesecurityVSAvoidsystem complexity

Core Design Contradiction:

ReliabilityVSDevice complexity

Solution Approach 1:

The patent applies universality by implementing a unified financial instrument management system that handles both physical and digital instruments through a common framework. The system uses a single logical structure to manage multiple PANs, with the same core functionality serving both instrument types, thereby reducing overall system complexity despite the separate PANs.

Inventive Principle:

Principle #6Universality (Multi-functionality)

Data Source

PatentUS20250217796A1System and method for payment device issuance, lifecycle management, and use

Publication Date: 2025.07.03 JPMORGAN CHASE BANK NA

AI summary

A method for payment device issuance, lifecycle management, and use may include a financial institution computer program: issuing a numberless, physical first financial instrument that is restricted to in-person transactions having a first primary account number (PAN) stored in a chip to a customer; issuing a digital, second financial instrument to an electronic wallet for the customer having a second PAN that is different from the first PAN; receiving a notification that the first financial instrument or the second financial instrument has been lost or compromised; in response to the first financial instrument being lost/compromised, reissuing the first financial instrument with a third PAN, wherein the second PAN for the second financial instrument is unchanged; and in response to the second financial instrument being lost/compromised, reissuing the second financial instrument with a fourth PAN, wherein the first PAN for the first financial instrument is unchanged.