Token-Based Gift Card System for Secure Fund Transfer
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Solution Overview
Problem
Existing gift card systems lack flexibility, creativity, and security, with limitations on redemption, poor interaction between parties, and vulnerabilities to theft and fraudulent activities, as well as difficulties for merchants to transition to new management platforms without significant expense and user experience issues.
Innovation Solution
A token-based system that allows for customizable, interactive gift cards with secure payment methods, enabling transfer of stored value between users, restrictions on redemption, and conversion of physical to digital gift cards, using unique tokens and a network of user databases, payment servers, and merchant POS terminals for secure transactions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of operation
If gift card information is printed or encoded on a plastic card, then the gift card can be physically used and redeemed, but it becomes vulnerable to theft and fraudulent activities before activation
Solution Approach 1:
The patent extracts the gift card value information from the physical plastic card by encoding it in a token on the card's magnetic stripe. The actual redemption capability is separated and stored remotely on servers, so that even if the physical card is stolen, the stolen card cannot be used without the remote authorization
Solution Approach 2:
The patent introduces an intermediary authorization system that mediates between the physical card and the redemption process. The token on the card serves as an intermediary element that must be validated by the remote server before any redemption can occur, preventing direct theft of value
2Ease of operation
If gift card systems use traditional plastic cards with printed information, then they are simple to use, but they provide little flexibility and creativity in customization and redemption options
Solution Approach 1:
The patent makes the gift card system multi-functional by enabling it to work across multiple platforms (physical stores, online retailers, mobile devices) and support various customization options (personalized messages, photos, selective redemption locations). The same token-based system handles both simple and complex gift card scenarios
Solution Approach 2:
The patent introduces dynamic capabilities to the gift card system, allowing restrictions and permissions to be changed remotely after issuance. Merchants can dynamically control where and how gift cards are redeemed, and users can receive dynamic notifications and interact with the gift card through mobile applications
3Adaptability or versatility
If gift card systems allow extensive customization and interaction features, then user experience is enhanced, but system complexity increases
Solution Approach 1:
The patent uses a centralized token validation server as an intermediary that handles the complexity of customization rules, restrictions, and interactions. This centralizes the computational burden and simplifies the client-side implementation, as the server manages all the complex logic for personalized messages, redemption restrictions, and notifications
4Reliability
If merchants want to convert existing gift cards to a new management platform, then they can benefit from improved security and features, but it requires significant expense and creates user experience issues
Solution Approach 1:
The patent enables merchants to create digital copies of existing gift card tokens and import them into the new system. Instead of requiring complete reissuance, the system copies the essential token information from old cards and validates them through the new platform's security infrastructure, maintaining continuity while upgrading security
Solution Approach 2:
The patent designs the new system to be universally compatible with existing gift card formats. The token validation mechanism can handle both traditional magnetic stripe cards and new digital formats, allowing merchants to gradually transition their user base without forcing immediate conversion or creating incompatibility issues
Data Source
AI summary
A method for transferring funds includes: 1) receiving, from a first user, a request to transfer a stored value to a second user; 2) identifying, based on a first user token and from a user database, a first entry containing information of a payment account of the first user; 3) causing a payment server to transfer funds corresponding to the stored value from the payment account of the first user to a stored-value account that is associated with a stored-value token; 4) associating the stored-value token with a second entry identifying a second user; 5) receiving a payment request initiated by the second user; 6) identifying the second entry based on a second user token included in the payment request; 7) updating funds in the stored-value account based on the payment request; and 8) transmitting at least a portion of the stored value to a merchant based on the update.