Transaction Processing System with Mobile Verification
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Solution Overview
Problem
Online monetary transactions face risks due to difficulties in verifying whether payment mechanisms, such as credit cards or bank transfers, are authorized by the correct individual, as merchants cannot visually confirm the cardholder's identity during online purchases.
Innovation Solution
A transaction processing system that receives transaction information, sends confirmation requests to the account holder's electronic device, and based on the response, approves or denies the transaction, incorporating features like SMS messages and risk assessments based on geographical location and response data.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of operation
If transaction authorization is performed without visual confirmation of cardholder identity, then transaction convenience is improved, but transaction security deteriorates
Solution Approach 1:
The patent introduces an intermediary verification system that acts as a mediator between the merchant and the account holder. This system receives transaction information from the merchant, sends verification requests to the account holder's mobile device, and relays the authorization response back to the merchant. The intermediary nature of this system allows convenient online transactions while maintaining security through a separate verification channel that does not require visual inspection of physical cards.
Solution Approach 2:
The patent replaces the mechanical system of visual card verification with an electronic communication system. Instead of visually inspecting physical credit cards or identification documents, the system uses electronic messages sent to mobile devices to verify account holder authorization. This substitution eliminates the need for physical card presentation while maintaining verification integrity through digital communication channels.
2Reliability
If transaction verification messages are sent to electronic devices, then transaction security is improved, but transaction processing time increases
Solution Approach 1:
The patent implements preliminary action by having account holders pre-register their mobile device information and authorization preferences before transactions occur. The system stores these pre-configured verification methods and can immediately send verification requests during transactions without requiring setup or manual configuration. This pre-prepared state reduces the time penalty of adding verification steps while maintaining security.
Solution Approach 2:
The patent allows account holders to skip or expedite verification steps by pre-configuring automatic authorization methods. For trusted merchants or recurring transactions, the system can bypass certain verification steps or use pre-approved authorization methods, allowing transactions to be completed quickly while still maintaining appropriate security controls for higher-risk transactions.
Data Source
AI summary
A transaction processing system according to various embodiments of the invention is adapted for: (1) associating a particular account (e.g., a credit card account) with a particular phone number; (2) at least partially in response to receiving a request to approve a transaction associated with the account, automatically transmitting a message (e.g., a text message) to the account holder via the phone number, requesting that the account holder confirm that the transaction is valid; and (3) using a response to the message to determine whether to approve or deny the transaction. In various embodiments, the request confirmation message requests that that the user answer a particular question (e.g., regarding out-of-wallet data), and the system is adapted to determine whether to approve or deny the transaction based on whether the response included a correct answer to the question.