POS Terminal Currency Conversion Using Pre-Downloaded Exchange Rates
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Solution Overview
Problem
Existing dynamic currency conversion systems face challenges in providing up-to-date exchange rates and lack merchant control over currency conversions, particularly for volatile currencies, and may not have sufficient information to determine the willingness to use home currency for transactions.
Innovation Solution
A method and system that processes transactions by determining if a card stores currency and country-related data, accessing these data from a POS terminal to request an exchange rate from a remote currency conversion system, and calculating the transaction amount with received rates, allowing for approval by the cardholder.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Measurement precision
If the POS terminal frequently downloads exchange rates to maintain up-to-date conversion rates, then the accuracy of exchange rates is improved, but the transaction processing speed deteriorates
Solution Approach 1:
The system performs currency conversion using exchange rates that were pre-downloaded and stored in the POS terminal's memory before the transaction occurs. This allows the terminal to use the most recently available exchange rates without needing to download them at the moment of transaction, thus maintaining accuracy while avoiding processing delays.
Solution Approach 2:
The patent introduces an intermediary mechanism where exchange rates are downloaded and stored in advance in the POS terminal's memory, acting as a buffer between the need for current rates and the need for fast processing. This intermediary storage allows the system to decouple the timing of rate acquisition from the timing of transaction processing.
2Reliability
If the merchant wants to maintain control over currency conversion for volatile currencies, then the reliability of transaction control is improved, but the system complexity increases
Solution Approach 1:
The patent enables merchants to configure specific controls for different currencies at the POS terminal level. The system allows merchants to specify which currencies require conversion control and which do not, providing localized quality control rather than a blanket approach. This means the merchant can exercise control over volatile currencies while allowing automatic processing for stable currencies, reducing overall system complexity.
Solution Approach 2:
The system provides dynamic control capabilities where merchants can adjust currency conversion settings based on current market conditions and merchant policies. The POS terminal can be configured to apply different conversion rules for different currencies, allowing the system to adapt to changing conditions without requiring complex manual intervention for each transaction.
3Ease of operation
If the system uses only ACC data on chip cards to determine home currency, then the ease of operation is improved, but the adaptability deteriorates
Solution Approach 1:
The patent makes the POS terminal's currency determination system universal by supporting multiple data sources beyond just the ACC tag on chip cards. The terminal can determine the cardholder's home currency using ACC data when available, but can also fall back to using BIN data from magnetic stripe cards or other identification methods. This multi-functional approach maintains ease of operation for chip cards while adding adaptability for other card types and scenarios.
Data Source
AI summary
A system and method for converting the amount of a transaction at a POS terminal from a local currency used by a merchant to an alternative currency (e.g., the home currency of the card). Card currency data obtained from a financial card is provided to a remote currency conversion system. The POS terminal determines whether a chip card is being used for the transaction, and if it is, card currency data on the card is accessed. The cardholder is provided a choice of completing the transaction using either the local currency or the home currency. On the other hand, if a card with a magnetic stripe is being used for the transaction, card number information on the magnetic stripe is used to determine possible home currencies and receive a selection from the cardholder of one of the possible home currencies or the local currency.