Analytics System Identifying Recurring Payment Merchants
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Solution Overview
Problem
Existing systems fail to efficiently identify merchants that perform recurring payment transactions, leading to difficulties in updating payment information and reducing the benefits of account-on-file payment models due to complex and time-consuming processes.
Innovation Solution
An analytics computing system that analyzes payment transaction data by generating actual transaction amount distributions, comparing them to a stored model distribution using Benford's Law, and calculating an angle distance to determine if a merchant is performing recurring payments, with alerts sent to analysts for identified recurring payment merchants.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of operation
If merchants store payment card information for recurring transactions, then payment convenience is improved, but identifying merchants with recurring payment programs becomes complex and time-consuming
Solution Approach 1:
The patent replaces manual identification processes with an automated computer-based system that uses Benford's Law mathematical analysis. The system automatically analyzes transaction amount distributions to identify recurring payment merchants, substituting mechanical manual review with automated computational analysis.
Solution Approach 2:
The system enables self-identification of recurring payment merchants through automated analysis of their own transaction data. The computer system autonomously processes transaction amounts, applies Benford's Law distribution analysis, and identifies merchants without requiring external intervention or manual classification.
2Productivity
If manual processes are used to identify recurring payment merchants, then system simplicity is maintained, but productivity and efficiency deteriorate
Solution Approach 1:
The system enables continuous automated analysis of payment transactions to identify recurring payment merchants. The computer system continuously processes transaction data, applies Benford's Law analysis, and identifies merchants in real-time or near-real-time, eliminating interruptions and maintaining continuous productive action.
Solution Approach 2:
The patent introduces a computer-based analytics system as an intermediary between transaction data and merchant identification. This intermediary automatically processes raw transaction amounts, applies mathematical distribution analysis, and produces identified recurring payment merchants, significantly reducing the time required compared to direct manual analysis.
3Measurement precision
If transaction data is analyzed using traditional methods, then measurement simplicity is maintained, but measurement precision and accuracy deteriorate
Solution Approach 1:
The patent applies Benford's Law distribution analysis to transform the analysis approach from simple counting to mathematical distribution evaluation. By analyzing the distribution pattern of transaction amounts and comparing against expected Benford's Law distributions, the system achieves higher precision in identifying recurring payment merchants through parameter-based mathematical analysis.
Data Source
AI summary
An analytics computing system for analyzing payment transaction data to identify merchants having a recurring payment program is provided. The analytics computing system is configured to receive first payment transaction data for a plurality of transactions associated with a merchant, generate an actual transaction amount distribution, compare the actual transaction amount distribution to a stored model distribution, compare an angle distance to a predefined threshold value, and identify whether the merchant is a merchant performing recurring payment transactions. The analytics computing system is also configured to store that the merchant is a recurring payment merchant and alert an analyst that the merchant is a recurring payment merchant by transmitting an alert message to a user computing device in communication with the analytics computing device.