Secure Payment System Automating Good Funds Transfers

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Solution Overview

Problem

Real estate transactions face challenges in securely and efficiently transferring large sums of 'good funds' due to reliance on manual processes like wire transfers and cashier's checks, which are susceptible to scams and time-consuming, while requiring immediate availability and irrevocability of funds.

Innovation Solution

A secure payment system that automates the transfer of good funds from an individual to an escrow account, allowing users to initiate and approve payments through a secure interface, utilizing real-time payment processes to ensure immediate and irrevocable transactions, reducing the need for manual verification and minimizing fraud risks.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Reliability

If wire transfers are used for home closing, then funds are considered safe and facilitate good funds transfers, but the process takes multiple days to complete and requires in person verification

Engineering Contradiction:

Improvesafety of fund transferVSAvoidtime to complete transfer

Core Design Contradiction:

ReliabilityVSLoss of time

Solution Approach 1:

The patent replaces the manual wire transfer process with an automated digital payment system using the FedNow service. The system automatically initiates and processes fund transfers electronically without requiring manual bank visits or in-person verification, achieving both speed and security through automation and real-time payment infrastructure.

Inventive Principle:

Principle #28Mechanics substitution (Replace mechanical system)

Solution Approach 2:

The system performs preliminary verification of the recipient account information before initiating the transfer. By validating account details and obtaining recipient confirmation in advance, the system eliminates the need for post-transfer verification steps that delay traditional wire transfers, enabling immediate fund delivery.

Inventive Principle:

Principle #10Preliminary action

2Productivity

If traditional wire transfer processes are used, then funds are immediately available and irrevocable, but the process requires manual retrieval from local bank and in person verification

Engineering Contradiction:

Improveimmediate availability of fundsVSAvoidmanual retrieval and verification process

Core Design Contradiction:

ProductivityVSEase of operation

Solution Approach 1:

The system enables self-service fund transfers where users can initiate payments directly through the digital platform without visiting their local bank. The automated system handles account verification, fund deduction, and transfer initiation, making the process as convenient as online banking while maintaining the security and immediacy of traditional wire transfers.

Inventive Principle:

Principle #25Self-service

3Reliability

If wire transfers are used for closing payments, then good funds are transferred securely, but scammers can compromise email to monitor correspondence and send spoofed emails with false wiring instructions

Engineering Contradiction:

Improvesecurity of fund transferVSAvoidphishing and spoofing scams

Core Design Contradiction:

ReliabilityVSObject-affected harmful factors

Solution Approach 1:

The system introduces an intermediary verification layer between the sender and recipient. The digital payment platform acts as a trusted mediator that validates recipient account information through secure channels, confirms transfers with recipients before execution, and provides transaction verification codes. This intermediary layer prevents scammers from intercepting or spoofing transfer instructions, as all verification occurs through the secure platform rather than untrusted email communications.

Inventive Principle:

Principle #24Intermediary (Mediator)

4Reliability

If certified or cashier's checks are used, then good funds are provided with immediate availability, but the process is manual and time-consuming

Engineering Contradiction:

Improveimmediate availability of fundsVSAvoidmanual processing time

Core Design Contradiction:

ReliabilityVSLoss of time

Solution Approach 1:

The patent replaces the mechanical process of obtaining and delivering physical certified or cashier's checks with an automated digital payment system. The system electronically initiates fund transfers through the FedNow service, eliminating the need for users to visit banks, wait for check issuance, and physically deliver checks to closing agents. This digital substitution maintains the immediate fund availability characteristic of certified checks while removing all associated manual steps and delays.

Inventive Principle:

Principle #28Mechanics substitution (Replace mechanical system)

Data Source

PatentUS20220414625A1Secure payment systems and methods

Publication Date: 2022.12.29 CLOSINGLOCK INC

AI summary

A method may comprise: receiving, via a secure payment system, transaction information associated with a real estate transaction, the transaction information including an escrow account, a buyer name, and a buyer contact, the escrow account configured to receive a good funds payment for an earnest money deposit or a closing payment; receiving, via the secure payment system, a first request to transfer the good funds payment from a user account of a user to the escrow account; querying, via the secure payment system, information associated with the user account; generating, via the secure payment system, a second request for payment to a financial institution of the user account; receiving, via the secure payment system, a notification that the second request for payment was approved by the user; and in response to receiving the notification, transferring the good funds payment from the user account of the user to a secure payment account of the secure payment system.