Electronic Payment Verification via Machine-Readable Codes
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Solution Overview
Problem
Consumers face difficulties in online transactions as they often receive products that are not as described or are defective, leading to cumbersome processes for exchanges or refunds, and existing payment methods require upfront payment or physical presence at delivery.
Innovation Solution
A system and method utilizing machine-readable codes (e.g., QR codes) for pre-authorization and verification during delivery, involving a merchant, manufacturer, and courier devices to ensure payment only upon successful delivery of the correct product, allowing for pre-authorization cancellation if the product does not match the encoded details.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of manufacture
If consumers pay upfront for online purchases, then merchants can process transactions easily, but consumers face difficulties obtaining refunds or exchanges when products are defective or not as described
Solution Approach 1:
The system performs preliminary authorization of the transaction before delivery, placing a hold on the consumer's funds without charging them. This allows the transaction to be prepared in advance while maintaining the option to cancel or complete the charge based on delivery verification, thus protecting consumers while enabling easy transaction processing.
Solution Approach 2:
The system implements feedback loops where the consumer can verify product receipt and condition, and the merchant can confirm delivery status. Based on this feedback, the pre-authorized transaction is either completed or cancelled, ensuring consumer protection while maintaining transaction efficiency.
2Ease of operation
If consumers use cash-on-delivery with mobile POS terminals, then payment can be made on delivery, but consumers must be physically present at the time of delivery with payment cards
Solution Approach 1:
The system replaces the mechanical requirement of physical card presentment and mobile POS terminal interaction with an automated electronic verification system. Machine-readable codes are scanned and verified automatically, and pre-authorized transactions are completed electronically without requiring the consumer to be physically present with payment cards at delivery.
Solution Approach 2:
The system introduces machine-readable codes and automated verification systems as intermediaries between the consumer, merchant, and courier. These intermediaries enable the transaction verification and completion process without requiring direct physical interaction or consumer presence, thus maintaining payment flexibility while reducing device complexity requirements.
3Reliability
If merchants require physical payment cards or mobile POS terminals for payment verification, then payment security is maintained, but the delivery process becomes more complex and requires consumer presence
Solution Approach 1:
The system uses machine-readable codes (such as QR codes) that contain encoded transaction information as digital copies of the payment authorization. These codes can be scanned and verified electronically without requiring the original payment card or physical presence, thus maintaining payment security through cryptographic verification while simplifying the delivery process.
4Productivity
If consumers receive products before verification, then delivery efficiency is improved, but consumers may receive wrong or defective products leading to refund issues
Solution Approach 1:
The system performs preliminary authorization and product identification verification before final delivery completion. Machine-readable codes on products are scanned and verified against the authorized transaction details in advance, ensuring product correctness before the consumer takes possession, thus maintaining delivery efficiency while enabling product verification.
Solution Approach 2:
The system implements verification feedback mechanisms where product identification information is checked against the authorized transaction. If the product matches the authorization, delivery proceeds efficiently; if there is a mismatch, the system provides feedback to prevent incorrect delivery, thus ensuring product verification without significantly impacting delivery efficiency.
Data Source
AI summary
System and method for facilitating electronic payment on delivery of a product. The system includes a merchant device; a manufacturer device that is in communication with the merchant device; and a courier device that is in communication with the merchant device. The merchant device is configured to: receive, from an issuer device that is in communication with the merchant device, a pre-authorization code in response to a request for pre-authorization of a transaction corresponding to an electronic payment request for the product; and generate a first machine-readable code having encoded thereon at least the pre-authorization code and an identifier corresponding to the product. The manufacturer device is configured to generate a second machine-readable code having encoded thereon at least the pre-authorization code and the identifier corresponding to the product. The courier device is configured to: generate a third machine-readable code having encoded thereon at least the pre-authorization code and the identifier corresponding to the product; and transmit, to the issuer device, an instruction to either (i) complete an authorization of the transaction or (ii) cancel the pre-authorization of the transaction, based on a comparison of the pre-authorization code and the identifier corresponding to the product that are encoded on the first, second and third machine-readable codes during delivery of the product.