Payment Unification Service for Micro-Transaction Fee Reduction
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Solution Overview
Problem
Point of sale (POS) devices face challenges in processing micro-transactions due to high transaction fees with traditional credit card systems, and users are deterred by the need to register with multiple payment services, limiting the viability of micro-transaction business models and reducing buyer participation.
Innovation Solution
A payment unification service that allows POS devices to communicate with multiple payment services, enabling users to transact using their preferred service while remaining anonymous, and aggregates micro-transactions to minimize fees, eliminating the need for users to register with each service.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If traditional credit card systems are used for micro-transactions, then payment security and reliability are improved, but transaction fees increase significantly
Solution Approach 1:
The patent combines multiple micro-transactions into a single batched payment transaction. By aggregating numerous small transactions and processing them as one consolidated payment, the system maintains security through the established credit card infrastructure while reducing the cumulative transaction fees that would result from processing each micro-transaction individually.
Solution Approach 2:
The system performs preliminary actions by collecting and buffering multiple micro-transactions before processing them. Transactions are accumulated in a queue or buffer and then batched together for unified processing, allowing the system to prepare and optimize payment processing before actual funds transfer occurs, thereby reducing fee overhead.
2Reliability
If users must register with each payment service to use POS devices, then payment service reliability is improved, but ease of operation deteriorates
Solution Approach 1:
The patent implements a universal payment interface that can handle multiple payment services through a single unified system. The POS device and payment processing system are designed to work with various payment providers (credit cards, debit cards, mobile payments, etc.) through a common protocol, allowing users to access different payment services without needing separate registration processes for each.
Solution Approach 2:
The system introduces an intermediary payment processing layer that mediates between the user and multiple payment services. This intermediary handles authentication, authorization, and transaction routing, allowing users to interact with a single interface while the underlying system manages communications with various payment providers, thus eliminating the need for users to register with each service individually.
3Loss of energy
If POS devices accept only cash for micro-transactions, then transaction fees are reduced, but adaptability deteriorates
Solution Approach 1:
The patent segments the payment processing function into two distinct parts: a unified acceptance interface that handles multiple payment types, and a backend processing system that optimizes transaction routing. This segmentation allows the POS device to present a versatile interface supporting cash, cards, and digital payments while the backend can route transactions through fee-efficient channels for micro-payments.
Solution Approach 2:
The system dynamically adapts its payment processing approach based on transaction characteristics. For micro-transactions, it can route through fee-efficient pathways or batch them together, while for larger transactions, it processes them individually through traditional channels. This dynamic behavior allows the system to maintain low fees for small payments while preserving full adaptability across different payment methods and transaction sizes.
Data Source
AI summary
Example embodiments relate to a point of sale device leveraging a payment unification service. In some examples, a system may include instructions for a seller unification gateway to receive, via a network, a transaction initiation signal from a point of sale device. The transaction initiation signal may be in response to a purchase request of a buyer that interacts with the point of sale device. The system may include instructions for the seller unification gateway to send, via a network, a transaction authorization request to a buyer unification gateway. The system may include instructions for the buyer unification gateway to receive, via a network, an authorization response from a buyer device near or in the point of sale device. The authorization response may be generated in response to the buyer interacting with the buyer device.