Distributed Payment Processing With Multi-Merchant Tokenization

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Solution Overview

Problem

Current payment management systems face challenges in supporting new POS devices and virtual electronic payment (VEP) entities, leading to delayed availability of new services, security risks, and lack of seamless integration with existing POS terminal systems, especially for merchants with multiple locations or franchises.

Innovation Solution

A distributed enhanced payment processing system utilizing a merchant POS terminal, a remote payment management system, and a remote VEP entity system, employing multi-merchant tokenization and end-to-end encryption to secure and decentralize sensitive transaction information, enabling seamless transactions across multiple merchants.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Adaptability or versatility

If current payment management systems rely solely on software from third party POS developers, then new POS devices and VEP entities can be supported, but the availability of new services is delayed due to overloaded POS developers

Engineering Contradiction:

Improvesupport for new POS devices and VEP entitiesVSAvoidavailability delay of new services

Core Design Contradiction:

Adaptability or versatilityVSLoss of time

Solution Approach 1:

The system segments the payment processing functionality by introducing a distributed payment client that operates independently on POS terminals. This client handles device-specific operations locally, while the central payment management system handles transaction processing. This segmentation allows new POS devices to be supported without overloading the central system, as the payment client can adapt to new devices independently.

Inventive Principle:

Principle #1Segmentation

Solution Approach 2:

The payment client acts as an intermediary between the POS terminal and the payment management system. It translates device-specific operations into standardized payment requests, enabling the system to support diverse POS devices and VEP entities without requiring the central system to handle each device type directly, thus accelerating service availability.

Inventive Principle:

Principle #24Intermediary (Mediator)

2Reliability

If traditional tokenization is used, then sensitive transaction information is secured, but merchants with multiple locations or franchises cannot rely on a single token and must individually input account information at each location

Engineering Contradiction:

Improvesecurity of transaction informationVSAvoidconvenience of multi-merchant transactions

Core Design Contradiction:

ReliabilityVSEase of operation

Solution Approach 1:

The system implements multi-merchant tokenization where a single token can be used across multiple merchant locations and franchises. The token is associated with a group of related merchants, allowing it to function universally across the entire network. This eliminates the need for individual account information input at each location while maintaining security through the tokenization mechanism.

Inventive Principle:

Principle #6Universality (Multi-functionality)

Solution Approach 2:

The system merges multiple merchant accounts into a single tokenized representation that can be used across all associated merchants. By combining the authentication credentials of multiple merchants into one secure token, the system enables seamless transactions across franchise locations while maintaining the security benefits of tokenization.

Inventive Principle:

Principle #5Merging (Combining)

3Adaptability or versatility

If VEP entity services are added to POS terminal systems, then broader payment services are available, but it causes disruption and change to the use of traditional card brand payer services

Engineering Contradiction:

Improverange of payment servicesVSAvoiddisruption to traditional payment services

Core Design Contradiction:

Adaptability or versatilityVSStability of the object's composition

Solution Approach 1:

The payment client serves as an intermediary that handles both traditional card brand payments and VEP entity services through a unified interface. It translates various payment types into standardized requests that the existing POS terminal system can process, allowing new services to be added without disrupting traditional payment workflows.

Inventive Principle:

Principle #24Intermediary (Mediator)

Solution Approach 2:

The system creates a universal payment processing layer that handles multiple payment types (traditional cards and VEP entities) through a single interface. This multi-functional approach allows the system to expand service offerings while maintaining compatibility with existing payment processes, minimizing disruption to traditional services.

Inventive Principle:

Principle #6Universality (Multi-functionality)

Data Source

PatentUS12469034B2Systems and methods for distributed enhanced payment processing

Publication Date: 2025.11.11 WORLDPAY LLC

AI summary

A distributed enhanced payment processing system includes a merchant point of sale (POS) terminal system and a remote payment management system. The POS terminal system initiates a transaction that includes receiving a payment amount, a purchaser account identifier, a virtual electronic payment indicator, and a merchant ID via a payment client. Subsequently, the POS terminal system outputs the transaction to the remote payment management system which generates a token for the transaction. The payment management system then provides the purchaser account identifier, a merchant account identifier, and the payment amount to a remote virtual electronic payment (VEP) entity system. Upon receiving a VEP entity system response, the payment management system outputs the response and token to the POS terminal system.