Smartphone Payment System Using SMS Fallback for Unreliable Networks
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Solution Overview
Problem
Existing electronic payment systems face challenges in emerging economies where wireless Internet connections are unreliable, particularly in Africa, and are unsuited for ad-hoc payment card transactions due to the need for dedicated infrastructure and inadequate SMS-based communication methods.
Innovation Solution
A system and method where a smartphone app connects to a card reader via Bluetooth, prioritizing internet transmission but using SMS and/or USSD if internet is unavailable, allowing the payload to be split into multiple messages for assembly at the back-end server, maintaining encryption security.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If dedicated wireless credit card terminals connected to payment networks are used, then transaction security and reliability are improved, but device cost and infrastructure complexity increase significantly
Solution Approach 1:
The patent uses a smartphone to copy the functionality of expensive dedicated POS terminals. The smartphone runs a payment application that emulates the terminal's card reading and communication capabilities, eliminating the need for costly dedicated hardware while maintaining security through software-based encryption and protocol implementation.
Solution Approach 2:
The smartphone serves multiple functions: it acts as the payment terminal, communicates with the card reader, processes transactions, and handles both internet and SMS/USSD communication modes. This multi-functional approach replaces dedicated infrastructure with a universal device that can operate in various network conditions.
2Ease of manufacture
If SMS-based payment communication is used in emerging economies, then cost is reduced and accessibility is improved, but transaction capacity and data transmission reliability deteriorate
Solution Approach 1:
The system dynamically switches between communication modes based on network availability. When internet connection is available, it uses high-capacity internet transmission for fast transactions. When internet is unavailable, it automatically falls back to SMS/USSD mode, ensuring continuous operation while optimizing for both speed and reliability based on actual network conditions.
Solution Approach 2:
The payment data is segmented and can be transmitted through multiple SMS messages if the payload exceeds SMS length limits. The system divides the data payload into smaller segments that can be sent via SMS, maintaining the ability to transmit complete transaction information even when using lower-capacity SMS channels.
3Speed
If internet-based payment transmission is used, then transaction speed and capacity are improved, but dependency on network infrastructure and cost increase
Solution Approach 1:
The system dynamically adapts its communication method based on network availability and conditions. It prioritizes internet transmission for speed when available, but automatically switches to SMS/USSD when internet is unavailable or unreliable, ensuring the system remains versatile and adaptable to varying network infrastructures in emerging economies.
4Adaptability or versatility
If payload data is transmitted via multiple SMS messages, then compatibility with basic GSM networks is improved, but data transmission time and complexity increase
Solution Approach 1:
The data payload is divided into smaller segments that can fit within SMS message limits. Each segment is transmitted separately via SMS, and the receiving system reassembles them into the complete payload. This segmentation enables compatibility with basic GSM networks while maintaining the ability to transmit complete transaction data.
Data Source
AI summary
A method and system for providing electronic wireless credit card transactions to small businesses in conditions where the wireless telecommunications network is old and/or underdeveloped. The system allows a merchant to accept payment cards firstly via TCP/IP and secondly via SMS and/or USSD wherever only the most basic GSM network is available. The merchant does not need dedicated wireless terminals to do that. With the smartphone app and the peripheral card reader using the novel method, a merchant in the middle of a remote African village or Siberia can accept a payment cards on the spot, right there and then, if basic GSM network is available, but can also use the same devices in e.g. central London with 4G networks. A corresponding software product is also described.