RoSCA Participation Matching for Vacant Entry Risk Mitigation
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Solution Overview
Problem
Existing Rotating Savings and Credit Association (RoSCA)-type online financial products face financial risks due to participant terminations, affecting both users and service providers, and there is a need for a solution to mitigate these risks while offering high interest rates and ensuring additional revenue for service providers.
Innovation Solution
A method and server system that identifies and facilitates participation in vacant or upcoming entries of existing and new RoSCA financial products, adjusting interest rates and contribution amounts to match user preferences, thereby resolving financial risks and providing immediate access to higher interest rates.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If a participant terminates a RoSCA-type online financial product, then the remaining participants and service provider suffer financial risk, but allowing termination provides flexibility for participants
Solution Approach 1:
The service provider acts as an intermediary that manages the financial risk by creating a virtual participation entry when a real participant terminates. This virtual entry allows the remaining participants to continue the RoSCA product without direct financial loss, while the service provider captures the interest rate difference as revenue, thus mediating between participant flexibility and financial reliability
Solution Approach 2:
The system changes the participation status parameter from real to virtual when a participant terminates. This parameter change allows the RoSCA product to continue operating with adjusted terms, converting the termination event from a financial risk into an opportunity for the service provider to adjust interest rates and maintain product continuity
2Loss of time
If users wait for new RoSCA products to be opened, then they can participate in fresh products, but they cannot access high interest rates immediately
Solution Approach 1:
The service provider creates a virtual participation entry in advance when a real participant terminates, before the user can join. This preliminary action ensures that the user can immediately participate in an existing RoSCA product with high interest rates without waiting for a new product to be opened, thus eliminating waiting time while maintaining interest rate reliability
3Productivity
If the service provider offers high interest rates to users, then user attraction increases, but revenue from traditional RoSCA participation decreases
Solution Approach 1:
The system converts the harmful effect of participant termination into a beneficial opportunity for the service provider. When a real participant terminates, the service provider creates a virtual participation entry that allows the user to join immediately and receive high interest rates, while the service provider captures the interest rate difference as additional revenue, thus turning a loss into a gain
Data Source
AI summary
A method of operating an online financial product corresponding to transaction at the order of a participation entry included in a Rotating Savings and Credit Association (RoSCA)-type online financial product includes receiving a search request message including search condition information for a desired financial product of a user from a user terminal; searching for a first matching financial product, which is a first financial product matching the search condition information among at least one first financial products that have been opened and are in progress; setting detailed information of a first virtual participation entry on the basis of detailed information of the vacant participation entry of the first matching financial product and the search condition information; and transmitting a search completion message including the detailed information of the first virtual participation entry to the user terminal. The method is performed in a financial service server.