Digital Wallet Prepaid Card Value Transfer via Escrow Mediation
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Solution Overview
Problem
Existing payment systems do not allow for quick and efficient transfer of value from one account to another, especially across different financial institutions, limiting user flexibility and revenue opportunities for card issuers and merchants, and restricting interactions between account administrators and consumers.
Innovation Solution
A system and method for transferring value between various types of accounts, including checking, savings, credit, debit, and prepaid cards, using a swap service that facilitates transfers through a consumer device connected to a remote system, allowing for escrow accounts, automated clearing house transfers, and digital equivalents of cards for payment, while enabling user-selected account transfers without requiring all accounts to be within the same institution.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If value transfer is restricted to accounts within the same financial institution, then system complexity is reduced, but user flexibility and adaptability deteriorate
Solution Approach 1:
The patent introduces a remote system as an intermediary that mediates value transfers between different financial institutions. The consumer device interacts with the remote system, which then coordinates with multiple card issuers and financial institutions to enable cross-institution transfers without requiring direct integration between all parties, thus maintaining user flexibility while managing system complexity through centralized mediation.
Solution Approach 2:
The remote system is designed with universal functionality to handle multiple types of card accounts (prepaid, debit, credit, gift cards) from different issuers through a single interface. This multi-functional approach allows the system to adapt to various account types and financial institutions without requiring separate systems for each, thereby improving user flexibility while avoiding the complexity of multiple specialized systems.
2Productivity
If quick value transfer between diverse accounts is enabled, then user flexibility improves, but reliability and security worsen
Solution Approach 1:
The system performs preliminary actions by establishing escrow accounts before value transfers occur. The remote system creates escrow accounts in advance and uses them to hold funds temporarily during the transfer process, enabling quick transfers while maintaining security through pre-established secure holding mechanisms. This preliminary setup allows immediate transfers without compromising reliability.
Solution Approach 2:
The remote system acts as a secure intermediary that coordinates authentication and authorization between consumer devices and multiple card issuers. It implements security protocols and verification processes centrally, enabling fast transfers by handling security checks through the intermediary rather than requiring complex point-to-point security implementations between each device and issuer.
3Reliability
If escrow accounts are implemented for secure transfers, then transfer security improves, but device complexity and processing time worsen
Solution Approach 1:
Escrow accounts are established in advance through preliminary action, so that when a transfer is initiated, the secure holding mechanism is already in place. The remote system pre-creates escrow accounts and sets up the infrastructure beforehand, allowing transfers to proceed quickly by simply moving funds into the pre-existing escrow structure rather than creating security mechanisms during each transfer transaction.
4Adaptability or versatility
If multiple account types from different institutions are integrated, then adaptability improves, but difficulty of detecting and measuring worsens
Solution Approach 1:
The remote system serves as a centralized intermediary that consolidates authentication and monitoring functions for multiple account types and issuers. By funneling all transfer requests through this single intermediary point, the system maintains adaptability across diverse accounts while simplifying fraud detection through centralized surveillance and pattern recognition, rather than requiring distributed detection across multiple independent systems.
Data Source
AI summary
Disclosed are the methods and systems for transferring value from as first account to a second account via a consumer device. The methods may be consumer or merchant driven and may involve transferring value to peers, oneself, or a third party account holder with or without the creation of a user account. Based on information input by a user, various financial systems interact in a manner that results in creation of an escrow account and effectuates transfer of value from a funding account through that escrow account to a receiving account. Such novel methods allow for previously unavailable transfers of value. In certain embodiments, the methods and systems also encompass creation of a digital equivalent of the value and using the digital equivalent to make payments at as point of service.