Transaction Account Tokenization for Fraud Risk Reduction
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Solution Overview
Problem
Digital transactions face increased risks of information breaches when transaction account information is stored or transmitted, and existing security measures incur processing and communication overhead.
Innovation Solution
A system for tokenizing transaction accounts, which generates tokens to obfuscate sensitive data, assesses fraud risk, and secures payment payloads using encryption and secure communication protocols, allowing for secure and efficient completion of transactions.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Productivity
If transaction account information is stored or transmitted to complete digital transactions, then transaction functionality is enabled, but the risk of information breaches increases
Solution Approach 1:
The patent creates a copy of the transaction account information in the form of a token that mimics the functionality of the original account data. The token contains sufficient information to enable transactions without exposing the actual account details, thus allowing transaction functionality while reducing information breach risk.
Solution Approach 2:
The token acts as an intermediary between the transaction account information and the transaction processing system. Instead of directly transmitting sensitive account data, the system uses tokens as mediators that carry the necessary transaction information without exposing the underlying account details, thereby enabling transactions while protecting against information breaches.
2Object-affected harmful factors
If security measures are implemented to protect sensitive transaction data, then information breach risk is reduced, but processing and communication overhead increases
Solution Approach 1:
The patent employs tokens that are essentially disposable or short-lived identifiers. These tokens can be easily generated, transmitted, and invalidated without requiring complex security infrastructure. Each token is designed to be used for a specific transaction or limited time period, reducing the need for long-term security measures and lowering processing overhead.
Solution Approach 2:
The system changes the parameters of data transmission by converting sensitive account information into tokens with different characteristics. Instead of transmitting full account details with high security requirements, the system transmits simplified token data with fewer security constraints, thereby reducing information breach risk while minimizing processing and communication overhead.
Data Source
AI summary
A system may receive a request for a payment payload for a payment transaction with the request including a token and a transaction amount. The token may identify a transaction account for use in the payment transaction. The system may assess the risk of fraud associated with the transaction account and the payment transaction. The system may return the payment payload in response to a favorable risk assessment. The payment payload may be passed to a merchant and from the merchant to a payment network for evaluation. The payment transaction may be approved or declined based on the contents of received payment payload matching the contents of a generated payment payload.