Proximity-Based Mobile Payment System for Cashless Transactions
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Solution Overview
Problem
Service providers often face barriers in receiving cashless payments due to lack of access to credit card terminals and high transaction fees, making cashless transactions impractical for small gratuities and donations, especially in a cashless society where personal information exchange is required, deterring both payors and payees from engaging in such transactions.
Innovation Solution
A method and apparatus that allow for proximity-based, peer-to-peer mobile payments without the need for personal information exchange, using devices to identify and authorize payments between payor and payee devices within a threshold distance, utilizing existing payment systems like Apple Pay, Google Pay, or cryptocurrencies, and displaying potential payees based on proximity for easy selection and transaction processing.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If personal information exchange is required for cashless transactions, then security and accountability are improved, but transaction time and complexity increase
Solution Approach 1:
The system performs preliminary actions by pre-establishing account associations with device identifiers and by pre-approving transactions within proximity thresholds. The payor's account is linked to their device ID in advance, and the system pre-validates the payee's device presence in the proximity zone, eliminating the need for real-time information exchange during the actual transaction.
Solution Approach 2:
The invention extracts and removes the personal information exchange step from the transaction process. Instead of requiring payors to input payee information, the system uses device identifiers and proximity-based location data to automatically identify and process payments to the intended recipient.
2Reliability
If credit card terminals are used for cashless payments, then payment security is improved, but device cost and maintenance complexity increase
Solution Approach 1:
The invention replaces the mechanical credit card terminal infrastructure with a software-based mobile payment system. The payment processing functionality is moved from dedicated hardware terminals to mobile devices running payment applications, eliminating the need for physical card readers and associated infrastructure.
Solution Approach 2:
The mobile device serves multiple functions: it acts as both the payment initiation device and the payment processing terminal. The same smartphone or mobile device that the payor uses to make a call or send a message also functions as the payment terminal, eliminating the need for separate credit card terminal hardware.
3Measurement precision
If traditional mobile payment systems require personal information input, then transaction accuracy is improved, but ease of operation deteriorates
Solution Approach 1:
The system performs self-service by automatically identifying the payee and processing the transaction without requiring manual information input from the payor. The mobile device automatically detects the payee's device in the proximity zone, retrieves the associated account information, and processes the payment without user intervention beyond initiating the payment and confirming the amount.
4Productivity
If cash exchanges are used for small gratuities, then transaction speed is improved, but loss of digital record and tracking capability increases
Solution Approach 1:
The system creates a digital copy or record of the cash transaction. The proximity-based payment system replicates the speed and simplicity of cash exchanges while simultaneously generating an electronic transaction record that is stored and can be tracked, providing both the benefits of cash speed and the advantages of digital record-keeping.
Data Source
AI summary
Methods and apparatus consistent with the present disclosure allow a customer or payor to select from a plurality of nearby vendors or payees when a computing device of the payor is physically close to electronic devices of the payees. Payee devices and locations of those payee devices may be identified and displayed on a display of a payor device. Once displayed, a specific payee device may be selected by the customer and an order for a product or service may be sent to the selected payee device from the payor device. After the product or service has been provided to the customer, information that confirms that purchase may be sent to any of the selected payee device, the payor device, or a payment processing computer and funds to pay for the product or service may be deposited into an account of the payee based on the confirmation.