FIELD OF THE INVENTION
[0001] This invention relates to the field of systems for carrying targeted electronic transactions in a financial system, and more particularly, to systems and methods for carrying targeted electronic transactions on the basis of the purpose of the electronic 5 transaction.
BACKGROUND OF THE DISCLOSURE
[0002] There has been a tremendous increase in the demand of cashless transactions in recent years. Further, there is a fast moving trend towards developing systems 10 and methods, which facilitate cashless transactions as a preferred way of financial transactions as compared to cash based transactions. It is envisaged that such cashless transaction has tremendous benefits and convenience and can save huge cost to exchequer by reducing or eliminating the dependence on paper or currency based transactions.
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[0003] One of the first forms of cashless transactions started with credit cards that are widely accepted by merchants through Point of Sale (POS) terminals, vending machines, ticketing machines, and the like. In this technology, users can swipe their cards and carry out the financial transaction after providing certain authorization information, such as Personal Identification Number, signature, biometrics, and the like. Various other cards, such 20 as debit cards, are more widely used in economies where access to credit is unavailable.
[0004] However, all these conventional systems involve a transaction between a user on one side and a merchant bank or some other financial institution on the other side. These conventional systems do not allow peer-to-peer transaction or transactions without the 25 involvement of the merchant bank or some other financial institution. Therefore, such conventional systems are highly limited in providing as a substitute of paper currency transaction.
[0005] The next form of cashless transactions uses contactless technology, 30 such as Radio Frequency Identification (RFID) or Near Field Communication (NFC) to effect transactions, usually between a POS and a customer. The transaction is initiated when the user brings his/her wireless enabled card in close proximity to a POS terminal or by touching
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the card to the POS terminal. The card stores information, such as electronic cash pre-loaded in the card, and other customer details, and the POS terminal has means for reading the card information and updating information as per the transaction. However, such technology also has various limitations, as it only allows vendor to customer transactions, and further requires the customers to pre-load their cards with money for performing any transaction. Such 5 solutions are also referred to as Pre Paid Financial Instruments.
[0006] Usually, these existing E-Currency and mobile wallet platforms use only a single currency type for transactions on a given card/wallet. For example, BITCOIN system uses bitcoin as the only currency globally, throughout their system. In BITCOIN, the 10 BITCOIN currency may be exchanged with a different type of currency, such as USD, outside the BITCOIN system.
[0007] Moreover, it has been observed that there are many EMV based stored value cards in the market, such as those from VISA, MASTERCARD, and DISCOVER. 15 These cards may store the amount in a given national currency, such as USD or INR. Such currencies may be considered as GLOBAL currencies, e.g., BITCOIN, USD, INR, and the like.
[0008] Also, these days there is another type of currency. This new form of 20 currency is reward points, loyalty point, flyer miles and the like, given to the users of various cards like store cards, loyalty cards, gift cards and the like. The users hold such currencies, which may be exchanged for different products or services within their closed network system. Such cards hold currencies which may be considered as CLOSED currencies.
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[0009] However, problems may be encountered when using electronic wallets because there is typically little or no ability to restrict the usage of accounts identified in the wallet. While a credit card stored in a wallet may be spent at any location that accepts this credit card, it may be desirable for other types of accounts to be restricted in how they can be spent. 30
[0010] Therefore, it would be desirable, for example, for a gift certificate account to be redeemable only at a restricted set of merchants. If the gift certificate account is a new payment account mechanism, this restriction may be built into the protocol for redemption of the gift certificate. 35
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[0011] However, a gift certificate account may be based on a credit card network (e.g. Visa®) and credit card account numbering format (e.g., based on a Visa® card format). Although the giver of the gift certificate may wish that the recipient use the gift certificate at only certain merchants, if the gift certificate is based on the Visa® account 5 number format there is typically nothing preventing the recipient from using the gift certificate anywhere than a place whereas Visa® card is accepted.
[0012] Further, if a user owns different types of closed currencies, such as different loyalty points, the user is forced to carry multiple loyalty cards, a MACY card, a 10 UNITED AIRLINES card and a SOUTHWEST AIRLINES card. It makes these closed currencies too restrictive.
[0013] Further, in such systems, it is not possible to earmark funds for specific targeted purposes. With global currencies such as BITCOIN and USD, the user is free to use 15 it for any purpose, such as purchasing any product or service where the card is accepted. With closed currencies, such as loyalty cards, the user is free to purchase any product or service where the card is accepted. For example, a user carrying a UNITED AIRLINES card may use his/ her points to either book an airline ticket or to rent a car or pay for hotel reservation. In this example, it is not possible for UNITED AIRLINES to earmark certain points specifically 20 for the purpose of purchasing airline tickets only, or for a rental car company towards future car rentals only. User may earn points while travelling on the airline but may prefer to use them for paying the hotel bill.
[0014] While such free use is in itself a very desirable feature of these 25 currencies in general, there are circumstances where it may not be desirable. There are circumstances where a given fund should be used for a targeted use only. For example, employers provide employees with benefits to cover health related costs, such as for paying Doctor’s bills, paying for pharmacies, or to cover for vacation travel with family (LTC), or to pay for house rent. While government subsidy funds are intended to be used for a particular 30 category – food, cooking gas, fertilizer, and the like, it is known that the final use of the funds is not necessarily for the intended purpose.
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[0015] This leaves space for misuse of funds for unintended purpose. For example, some funds that may be earmarked by government and transferred to electronic wallets for buying essential commodities may be misused to buy some other undesirable lifestyle.
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[0016] Therefore, multiple currency types as well as targeted use currency (like government subsidy funds to be used for a particular category – food, cooking gas etc.) will ease carrying comfort and also reduce the leakage in subsidy driven projects.
[0017] Moreover, currently, the process of transferring money is complicated 10 and not user-friendly. There are a number of forms and processes that must be completed prior to completing money transfer. Furthermore, when a person sends money to another person, he or she is often unsure of exactly how the money would be spent. Accordingly, improvements are required.
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SUMMARY
[0018] In light of the above objects, the present invention provides a system and method for carrying targeted electronic transaction in a financial system.
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[0019] In an aspect, the present invention provides a digital wallet having electronic cash stored therein, wherein the electronic cash has a pre-defined allocated purpose. The digital wallet is capable of carrying targeted electronic transactions with various other digital wallets and/ or a transaction terminal in a financial system. The digital wallet includes a communication interface adapted to send and receive data, a processor and a 25 memory which includes a purpose determination module capable of identifying the purpose of the said electronic transaction. The purpose determination module is further adapted to either and accept or decline the said electronic transaction on the basis of identified purpose of the said electronic transaction. The memory further includes a transaction module for carrying out the electronic transaction on acceptance of the electronic transaction request. 30
[0020] In one embodiment, the purpose determination module accepts or declines the said electronic transaction by comparing the purpose of the said electronic transaction with the allocated purpose of the electronic cash stored in the digital wallet.
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[0021] In another embodiment, the purpose determination module facilitates the electronic transaction when the purpose of the said electronic transaction matches with the allocated purpose of the electronic cash stored in the digital wallet.
[0022] In yet another embodiment, the purpose determination module declines 5 the electronic transaction when the purpose of the said electronic transaction does not match with the allocated purpose of the electronic cash stored in the digital wallet.
[0023] In an aspect, the present invention provides a method for carrying targeted electronic transaction in a financial system, using one or more digital wallets as 10 described above. The method includes the steps of enabling at least one transaction terminal, and selecting one or more digital wallets. The said selection is being done by the at least one transaction terminal, and the next step includes sending an electronic transaction request to the selected digital wallet from the at least one transaction terminal via a communication means. The next step includes identifying the purpose of electronic transaction, wherein the 15 said identification is done by the selected digital wallet. The next step involves and carrying or declining the said electronic transaction on the basis of identified purpose of the said electronic transaction.
[0024] In another aspect, the present invention provides system for carrying 20 electronic transactions in a financial system. The system includes at least one server, at least one transaction terminal in communication with the server and one or more digital wallets communicably coupled to the server. The digital wallet includes a communication interface adapted to send and receive data, a processor and a memory comprising a purpose determination module and a transaction module. The said purpose determination module is 25 adapted to identify the purpose of the said electronic transaction, and accept or decline the said electronic transaction on the basis of identified purpose of the said electronic transaction. The transaction module is adapted to carry out the electronic transaction on acceptance of the electronic transaction request.
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[0025] In an aspect of the present invention, an electronic transaction is carried when the purpose of the electronic transaction matches with the purpose of the electronic cash stored in the digital wallet.
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[0026] In an aspect of the present invention, an electronic transaction is declined when the purpose of the electronic transaction does not match with the purpose of the electronic cash stored in the digital wallet.
[0027] These aspects together with other aspects of the present invention, 5 along with the various features of novelty that characterize the present invention, are pointed out and form a part of the present invention. For a better understanding of the present invention, its operating advantages, and the specific objects attained by its uses, reference should be made to the accompanying drawing and descriptive matter in which there is illustrated an exemplary embodiment of the present invention. 10
BRIEF DESCRIPTION OF THE DRAWINGS
[0028] The advantages and features of the present invention will become better understood with reference to the following detailed description taken in conjunction 15 with the accompanying drawings, in which:
[0029] Fig. 1 illustrates a form of a digital wallet when implemented as standalone hardware devices (“Hardware Based Digital Wallet”), according to various embodiments of the present invention are practiced; 20
[0030] Fig. 2 illustrates another form of implementing a digital wallet as a software application (“Software Based Digital Wallet”) running on a tablet or mobile phone instead of a standalone hardware device, on which various embodiments of the present invention are practiced; 25
[0031] Fig. 3 illustrates a platform for implementing the digital wallets, according to various embodiments of the present invention;
[0032] Figs. 4-6 illustrate communication between digital wallets of the 30 present invention with other devices, according to various embodiments of the present invention;
[0033] Fig. 7 illustrates transactions between a digital wallet and a Point of Sale (POS) terminal, according to various embodiments of the present invention; 35
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[0034] Fig. 8 illustrates a flow chart of how a payment transaction may happen between the digital wallet and the POS, according to various embodiments of the present invention; and
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[0035] Fig. 9 provides an example of various types of currencies which can be stored in a single wallet, according to various embodiments of the present invention.
[0036] Like reference numerals refer to like parts throughout the description of several views of the drawing. 10
DESCRIPTION OF THE INVENTION
[0037] The exemplary embodiments described herein for illustrative purposes are subject to many variations in structure and design. It should be emphasized, however, that the present invention is not limited to a system and method which provides targeted 15 electronic transactions with various users and transaction terminals in an electronic payment system. It is understood that various omissions and substitutions of equivalents are contemplated as circumstances may suggest or render expedient, but these are intended to cover the application or implementation without departing from the spirit or scope of the present invention. 20
[0038] The terms “a” and “an” herein do not denote a limitation of quantity, but rather denote the presence of at least one of the referenced item.
[0039] The terms “having”, “comprising”, “including”, and variations thereof 25 signify the presence of a component.
[0040] As used herein, “electronic cash” relates to any kind of currency in electronic form. The term electronic currency includes “closed currency” as well as “global currency”. 30
[0041] As used herein, “closed currency” may include currency that is designated for use at a particular merchant, or at a selected group of merchants. The closed currency is a merchant specific currency that has been designated for use with a particular
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merchant and may be referred to as being “associated” with that merchant. The term ‘closed currency’ does not denote a limitation to physical currency, target use currency, lock currency, money or its equivalent; but rather denotes any accruable, tradable, transferrable financial instrument, object or record.
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[0042] As used herein, “global currency” may include currency that may be generally used in transactions without restrictions based on the merchant involved in the transaction. The term ‘global currency’ does not denote a limitation to physical currency, money or its equivalent; but rather denotes any accruable, tradable, transferrable financial instrument, object or record. 10
[0043] The term “financial system” as used throughout the specification relates to any system which involves financial transactions being carried in electronic way. The transactions are electronic transactions for specific purposes.
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[0044] The present invention provides systems and methods for controlling the use of money in an electronic transaction system. More specifically, the present invention provides for an electronic version of a wallet (also interchangeably referred to as “digital wallet”) to replace cash carried by users in their wallets with a special feature of restricting targeted usage of the money stored in the wallets. Accordingly, the system and method allows 20 users to imitate various transactions that are usually done with physical currency notes.
[0045] In various embodiments, the present invention allows a user to carry out transactions with or without the need to be connected to a network backbone. In other words, the present invention provides systems and methods for carrying electronic 25 transactions with the restrictions of use of currency, in both online mode and offline mode. In various embodiments of the present invention, the systems and methods for carrying electronic transactions allow transactions in an offline mode, i.e., without the wallets, being connected to the network, as described in the co-pending application numbers (1040/DEL/2014 and 1041/DEL/2014) from co-inventors. 30
[0046] The present invention further provides a system and method enabling different currency types to be stored on a single device or a card or a digital wallet. Accordingly, the system and method reduces the number of cards that the user is required to
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carry for carrying these various currency types. For example, the user may be able to carry loyalty points from different companies, such as airline companies like UNITED AIRLINES and SOUTHWEST AIRLINES, on the same card. Such aggregation provides ease of operation for the user.
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[0047] Further, the present invention provides a system and method which is adapted to allow the fund providers to earmark or lock the funds (or allocate a specific purpose to the funds) for a targeted use or purpose and ensure that those funds are used only for the intended use or purpose by disallowing those funds from being misused.
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[0048] Moreover, the digital wallet may be used for multiple currencies like global currency or closed currency. Closed currencies are a merchant targeted currency which may not be generally used for transactions with other merchants (or other payment recipients) that are not associated with the every merchant.
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[0049] In such a case, the currency may have a specific value, such as, for example, $10 voucher for TAG watches. The merchant targeted currency may be “applied” to a transaction amount used for the TAG watches, meaning that it may be used as payment for the transaction amount, or a portion thereof. In some embodiments, the merchant target currency may be used to pay a portion of the required transaction amount. Merchant targeted 20 currency may be associated with a targeted use currency account. The digital wallet may be used for following types of targeted use currency referred as closed currency. For example,
a. For storing coupon code, gift prize, frequent flyer miles, loyalty points for stores, reward cards, gift cards, rewards points etc. 25
[0050] In such embodiments, the wallet may store information about the user, number of reward points or miles accumulated, and the like.
b. For entry into amusement parks, theatres, concerts, and other similar 30 examples.
[0051] The present invention further allows the storage of multiple global currency types; Rupee (INR), Dollar (USD), Euro etc. in one digital wallet.
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[0052] In another embodiment, the Point of Sale Terminal (POS), with which these wallets interact, may be enabled with a mechanism like GPS (Global Positioning System) which can provide the accurate location of the Point of Sale Terminal. The transactions with the Digital Wallet can then be “location stamped” in order to find out the geographical area where the transaction was carried out by the digital wallet. This feature is 5 very helpful in finding out useful information like buying patterns of users, number of users in a given geographical area, location of a stolen digital wallet, and the like.
[0053] A location enabled wallet has the ability to switch payment into the preferred currency at that location. So, if a wallet is in India, it will enable INR as the prime 10 means of payment and will automatically change to Euro when the wallet is in Europe.
[0054] The digital wallet of the present invention and the methods embodied in the present invention will now be explained with reference to various figures, such as Figs. 1-8. 15
[0055] Fig. 1 illustrates form factor of a digital wallet 100 when implemented as standalone hardware device. In Fig. 1, there is shown a digital wallet 100. The digital wallet 100 includes a communication interface 112. The communication interface 112 is adapted to send data to other digital wallets and receive data from other digital wallets or to 20 other components of the system, such as Point of Sale (POS) device, and the like. In an exemplary embodiment, the communication interface 112 may include one or more wireless trans-receiver 112a, which is capable of transmitting or receiving data.
[0056] Furthermore, the digital wallet 100 includes a processor or a 25 microprocessor 110 for executing instructions, and a memory module 114 for storing instructions. Specifically, the memory module 114 includes a storage means for storing financial or user personal information. Examples of information include, but are not limited to, transaction information, earmark information (or interchangeably referred to as “predefined purpose”) with amount of various currency types defined by the fund provider, 30 Unique Identification (UIDAI) including Biometrics information, national identity number such as Social Security Number (SSN), Driver’s License (DL) Number, loyalty points information, frequent flyer miles information, and club membership information, and the like,
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for one or more users using the digital wallet 100. The memory 114 could be in one or more physical manifestation.
[0057] Furthermore, the memory 114 includes a transaction module 114a, an applet module 114b, a currency conversion module 114c and a Purpose Determination 5 Module 114d. All modules including 114a, 114b,114c and 114d may be a software application having computer readable instruction, computer program and the like. In one embodiment, all modules including 114a, 114b and 114c may be downloadable in the memory 114 of the digital wallet 100. Particularly, all modules including 114a, 114b and 114c may be downloadable from any network or storage source, for example, but not limited 10 to, Internet, CD ROM, USB and the like. For example, a user of the digital wallet 100 may download the transaction module 114a from the internet and install the said transaction module 114a on the digital wallet 100.
[0058] Further, the transaction module 114a is adapted to perform electronic 15 transaction in an offline manner. In an embodiment, the transaction module 114a is adapted to perform electronic transaction in an online manner. In one embodiment, the transaction module 114a is adapted to carry an electronic transaction. However, such function of the transaction module 114a should not be construed as a limitation to the present invention. Accordingly, the transaction module 114a may be capable of performing other functions in 20 the digital wallet 100.
[0059] The memory 114 also includes the applet module 114b. This module may contain various secure applets, adapted to perform intended function. In one embodiment, the secure applet could be used for validation of a person such as the driving 25 license. In another embodiment, it could be used as a payment instrument for local transportations.
[0060] Further, the conversion module 114c is adapted to perform various functions, according to the present invention. The conversion module 114c is a location 30 enabled currency converter. The conversion module 114c allows digital wallet to switch payment into the preferred currency at that location. So, if a wallet is in India, it will enable INR as the prime means of payment and will automatically change to Euro when the wallet is in Europe.
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[0061] In an embodiment, Purpose Determination Module 114d or PDM 114d is adapted to perform various functions, according to various embodiments of the present invention. The PDM 114d is adapted to keep track of the allocated purposes of the electronic cash stored into the digital wallet and it ensures that those funds are used only for 5 the intended use or purpose by disallowing those funds from being misused. More specifically, the PDM 114d is adapted to identify the purpose of a requested electronic transaction, and accept or decline the said electronic transaction request on the basis of identified purpose for which the said electronic transaction is being requested.
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[0062] The PDM 114d is adapted to store earmark information along with the allocated amount or electronic cash to be used according to the fund provider. The earmark information is the information regarding targeted use of currency or funds for targeted merchants, but not limited to, shops, ecommerce website like eBay, amazon etc. retailers, service providers, charity organization, product information and the like. 15
[0063] In another embodiment, the Purpose Determination Module 114d or PDM 114d is adapted to identify the purpose of an electronic transaction request which may be received by the digital wallet from a transaction terminal in the financial system. The transaction terminal disclosed here relates to any terminal where a user of the digital wallet 20 desires to spend the respective electronic cash. Whenever, a user who is using the digital wallet procures certain merchandise and is required to make payment for the same at a transaction terminal, and then the transaction terminal sends out an electronic transaction request to the digital wallet. On receipt of such request, the PDM 114d is adapted to identify the purpose of this electronic transaction request with the allocated purpose of the electronic 25 cash stored in the wallet. If this electronic transaction request matches the purpose of the electronic cash as available in the digital wallet, then the PDM 114d accepts or rejects the electronic transaction request. It is further adapted to provide instructions to the transaction module 114a for carrying the electronic transaction when the electronic transaction request matches with the purpose of the electronic cash stored in the wallet. Furthermore, the PDM 30 114d is adapted to check if the allocated fund is sufficient for the said electronic transaction request.
[0064] Referring to Fig. 1, the digital wallet 100 further includes various security features for securing the digital wallet 100. The security features are important to
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prevent unauthorized access of the digital wallet 100, and to make sure that only valid users are able to use the digital wallet 100.
[0065] In one embodiment, the digital wallet 100 includes an authentication module 122. The authentication module 122 is adapted to authenticate the user of the digital 5 wallet 100. It will be apparent to a person skilled in the art that security is paramount for these digital wallets, such as digital wallet 100. In one embodiment, the authentication module 122 may be a secure chip or a biometric type authentication module. In this case, the authentication module 122 further includes a Biometric Input unit 122a which may be adapted to provide additional support for biometric identification like finger print, retina, 10 voice or facial detection. It enhances the overall security of the digital wallet 100. In addition, in various embodiments of the present invention, the digital wallet 100 may include various biometric units, for example camera, iris scanner, retina scanner, DNA identification device and the like which may strengthen the user authentication for accessing the digital wallet 100. However, such example of the biometric type authentication should not be construed as a 15 limitation to the present invention. Accordingly, in another embodiment, the authentication module 122 may be any other authentication module, such as Personal Identification Number (PIN) or signature based authentication module.
[0066] The digital wallet 100 further includes a secure element 126 for 20 providing enhanced security to the digital wallet 100. It includes security keys and cyphers that are used to establish the identity of the device, functionality to encrypt and decrypt all communications that happen with other devices on the wireless network and functionality to store the sensitive information on the device in a secure manner. The encryption of the communication is highly essential in maintaining the security of the digital wallet 100. The 25 secure element also provides for currency storage, preparation of payment and verification of payment between digital wallets.
[0067] Referring to Fig. 1, the digital wallet 100 includes a power module 116 adapted to harvest energy from the environment and conserve power requirements of the 30 digital wallet 100. The power module 116 satisfies the power need of the digital wallet 100. The power module 116 may include various oscillators, timers and other circuitry elements for such purposes.
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[0068] In one embodiment of the present invention, the power module 116 includes powering unit 116a (such as a rechargeable battery source), an auxiliary powering unit 116b, which may include one or more solar panel units, and a power controller unit 116c. The power controller 116c is adapted to cease power of the digital wallet 100 in one or more predefined situations. 5
[0069] In one embodiment, the power controller 116c is adapted to control the power supply in one or more predefined situations. The predefined situations include a situation where the power controller 116c automatically turns off or reduces power consumed by the digital wallet 100 after the completion of the electronic transaction or in a situation 10 where the digital wallet 100 is inoperable for predetermined duration of time, for example 5-10 seconds. This assists the digital wallet 100 to save power, a key requirement for operating in remote areas.
[0070] Referring to Fig. 1, in an embodiment, the digital wallet 100 also 15 includes an audio/visual unit 118 adapted to provide various visual/Audio notification including alerts. Suitable examples of alerts or tags may include tags for events such as Deposit or Withdraw in the linked Bank Account, Low Balance, Low Battery, invalid authentication and the like. This makes the digital wallet 100 easy to operate and more importantly user friendly. 20
[0071] In an embodiment, the audio/visual unit 118 includes a display 118a, an audio Input 118b, an Audio Output 118c and a Visual alert device 118d, are optional features of the present invention. The Audio Input 118b may be adapted to provide biometric identification of the user of the digital wallet 100 by voice recognition method. Further, the 25 Audio Output 118c is adapted to provide audio feedback to the user. This audio output functionality is extremely beneficial for impaired or less educated or illiterate users.
[0072] Further, the digital wallet 100 includes a user Input unit 120. Input unit 120 is an essential interface between the digital wallet 100 and the user thereof. The Input 30 unit 120 could be through a touch interface in lieu of a physical button. The user using the Input unit 120 uses iconic or alphanumeric based input. Accordingly, the Input unit 120 may include one or more keys for allowing the user to enter the input. However, such examples of the Input unit 120 should not be construed as a limitation of the present invention.
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Accordingly, the Input unit 120 may also be a gesture, a voice, or any other type of Input unit 120 which allows a seamless interfacing between the user and the digital wallet 100.
[0073] In one embodiment of the present invention, the digital wallet 100 may be implemented entirely at a software level. In such scenario, the digital wallet 100 may be in 5 form of a software module 500 (as shown in Fig. 2) configurable onto known in the art data processing devices 102, such as smart phones, tablet computers and the like, as shown in Fig. 2. It will be apparent to a person skilled in the art that the data processing device 102 may already include the communication interface 112, the processor 110 , the secure element(not shown in fig 2) and the memory 114 (not shown in the Fig. 2) inherently in the device 102. 10
[0074] Referring to Fig. 2, there is shown an interface of the digital wallet 100 at the software level. As shown in Fig. 2, the software module 500 is configurable on the device 102. An interface 510 as shown in Fig. 2 illustrates options to pay and receive, for example to pay, target use currency, reward points, shopping credits or other such payment 15 options. An interface 510 as shown in Fig. 2, illustrates options to conduct transactions, such as banking transactions including Deposit, Withdraw, Transfer, and Balance Inquiry. However, it should be clearly understood that such transaction and/or schematic layout of the digital wallet 100 should not be construed as a limitation to the present invention. The layout is highly adaptable and customizable according to the needs and desires of the user. The 20 transactions by the digital wallet are customizable in accordance with business cases.
[0075] Referring to Figs. 3-6, there are shown electronic transactions between digital wallets 100 with other devices via low power short range communication 400. In Fig. 3, there is shown a platform 810, which includes a server 800, a target currency module 804, 25 at least one transaction terminal 300, and one or more digital wallets, such as digital wallets 100.
[0076] Further, the server 800 includes a database 802 for storing financial and user specific information, such as target use currency or closed currency, loyalty points, 30 frequent flyer miles, and club membership information, financial and personal information of the users. The server 800 may be a bank server, merchant server, financial institution server, any third party server and the like connected to the fund providers via wireless communication 200.
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[0077] The server 800 is adapted to communicate with at least one fund provider 830 via wireless communication 200 and allows the at least one fund provider 830 to transfer their fund to the at least digital wallet 100 or the at least digital wallet 102 with or without an earmark information via wireless communication means. The earmark information 5 is associated with the electronic cash/fund being transferred by the target currency module 804 to the digital wallets of the users. To explain this, an example of medical insurance covers provided by an employer to an employee is provided. In such cases, the medical insurance is provided by the employer in conjunction with a policy provider such as a bank. Now, the fund provided by the bank for covering the medical insurance to the employee is 10 secured with earmark information or allocated purpose for spending the fund only for medical purposes.
[0078] Further, the server 800 receives the electronic cash with the instruction for releasing the funds or electronic money only for specific allocated purpose or targeted use 15 from the fund providers 830. Further, the server 800 is adapted to store the electronic money in the server database and the target use instruction. Further, the target currency module 804 couples the earmark information with the electronic cash or funds. Further, the server 800 is adapted to transmit the electronic funds to the assigned digital wallet 100 with or without the earmark information. 20
[0079] Further, the digital wallets 100 are capable of communicating with each other and with a Point of Sale (POS) or transaction terminal 300 via low power short communication 400 for facilitating transactions in an offline manner without the need to be connected to the Wide Area Network, such as the internet. In other words, the digital wallets 25 100 may be operable and capable of receiving electronic cash with or without earmark information and also capable of carrying numerous transactions without connecting to the server 800. When the carried electronic transactions are required to be reconciled, the digital wallets 100 may come in communication with the server 800 via the WAN interface 200.
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[0080] Referring to Fig. 3 again, in another embodiment of the present invention, the digital wallets 100 are capable of connecting to the World Wide Web (WWW) through wireless network or WAN interface 200. Further, the digital wallets 100 may be operable and capable of receiving electronic cash with or without earmark information and
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also capable of carrying numerous transactions while connecting to the server 800. Further, the digital wallet is adapted to update all the carried electronic transaction information to the server 800 automatically or manually.
[0081] Fig. 4 illustrates a communication between two digital wallets, first 5 digital wallet 100 (implemented as a hardware device referred to as hardware wallet) and a second digital wallet 102 (implemented as a software application referred to as software wallet) via a communication medium 400. Further, the digital wallets 100 are capable of communicating with one or more digital wallets 102 after connecting via low power short communication 400. Further, the digital wallets 100 are adapted to transfer global currency 10 and the target use currency or closed currency to the one or more digital wallets 102 after connecting via low power short communication 400. When first digital wallet 100 receives an electronic transaction request from the second digital wallet 102, the Purpose Determination Module 114d or PDM 114d of the digital wallet 100 identifies the purpose of the said electronic transaction request. Thereafter, the PDM 114d is adapted to compare the identified 15 purpose of the electronic transaction with the purpose or the earmark information of the electronic cash stored in the digital wallet 100.
[0082] Fig. 5 illustrates yet another embodiment. A communication between two digital wallets, first digital wallet 100 (implemented as a hardware device referred to as 20 hardware wallet) and a second digital wallet 102 (implemented as a software application referred to as software wallet) via a communication medium 400 with the software wallet 102 communicably coupled to the server 800 (as shown in Fig.3) via the WAN interface 200
[0083] In an embodiment, if the identified purpose of the electronic 25 transaction request matches with the purpose of the electronic cash stored in the digital wallet or it matches the earmark information of the electronic cash then the PDM 114d sends instructions to the transaction module 114a for carrying out the electronic transaction.
[0084] In another embodiment, if the purpose of the electronic transaction 30 request does not match with the purpose of the electronic cash or the earmark information of the electronic cash as stored or available in the digital wallet, then the PDM 114d declines the said electronic transaction request. This however, should not be construed as a limitation to
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the said digital wallet. There may be instances when the digital wallet may allow the electronic transaction for partial amount of the said electronic transaction request.
[0085] Further, in case of closed currency, the digital wallet 100 is adapted to communicate with a transaction terminal 300 via short range communication 400 or wireless 5 communication 200. After synchronization, the electronic transaction information is updated to the server database 801 whenever the transaction terminal 300 gets connected to the server 800 via World Wide Web (WWW) through the WAN interface 200.
[0086] Further, hardware digital wallet 100 is capable of communicating with 10 each other via low power short communication 400 for facilitating transactions in an offline manner without the need to be connected to the Wide Area Network, such as the internet. This carried transaction gets synchronized whenever either of the first digital wallets 100 gets communicably coupled to the server 800 via the WAN interface 200 (not shown) can be processed as shown in Fig. 4. 15
[0087] In another embodiment, the hardware digital wallet 100 is capable of communicating with each other via low power short communication 400 for facilitating transactions in an online manner, which means that the carried electronic transactions happen in real time in real world over an internet backbone. 20
[0088] Fig. 6 illustrates a communication between a first digital wallet 102 (Implemented as a software application) and a second digital wallet 102’ (Implemented as a software application) via a communication medium 400. In this particular case, the transaction or transfer of electronic cash between the first digital wallet 102 and the second 25 digital wallet 102’ is carried out with or without the need of server 800 (shown in Fig.4). This carried transaction gets synchronized whenever either of the first digital wallet 102 or the second digital wallet 102’ gets communicably coupled to the server 800 (as shown in Fig.3) via the WAN interface 200. In another embodiment either of the first digital wallet 102 or the second digital wallet 102’ is communicably coupled to the server 800 during the transaction. 30
[0089] The operation of the digital wallets, such as the digital wallet 100, for carrying out electronic transactions with each other and with transaction terminal and restrict the user of digital wallet to misuse the target fund or currency which is received from the
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fund providers 830 for specific purpose, such as transaction terminal 300 will now be explained. The entire process of conciliation and reconciliation of electronic transactions of the global currency or the target use currency will also be explained. Reference is made to Figs. 7 to 9.
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[0090] Fig. 7 illustrates an electronic transaction between the at least one digital wallets, such as digital wallets 100 or 102 and a transaction terminal 300. As shown in Fig. 7, the at least one digital wallets 100 or 102 are in communication with the transaction terminal 300. This transaction terminal 300 can go, such as online, that is connected to the server 800, which may be hosted over WAN interface 200, such as Internet. 10
[0091] Further, the digital wallets 100 are capable of communicating with each other and with a Point of Sale (POS) or transaction terminal 300 via low power short communication 400 for facilitating transactions in an offline manner without the need to be connected to the Wide Area Network, such as the internet. In other words, the digital wallets 15 100 may be operable and capable of receiving and transmitting the electronic cash with or without earmark code and also capable of carrying numerous transactions with the POS 300 without connecting to the server 800. This stored transaction gets synchronized whenever either of the first digital wallet 100 or the second digital wallet 102 and the transaction terminal 300 gets communicably coupled to the server 800 via the WAN interface. 20
[0092] Fig. 8 illustrates a simplistic flow chart of how a payment transaction may happen between the digital wallet 100 and the transaction terminal 300, according to various embodiments of the present invention. As shown in Fig 8, the method starts at step 405. At step 410, the method 700 is adapted to enable at least one transaction terminal for 25 processing an electronic transaction. At step 415, the said transaction terminal selects a digital wallet from the one or more digital wallets as available in a financial system. After selecting the digital wallet, the transaction terminal is adapted to send an electronic transaction request to the digital wallet at step 420. Once the digital wallet receives the electronic transaction request from the transaction terminal, the Purpose Determination 30 Module or PDM in the digital wallet identifies the purpose for which such transaction request has been received at step 425.
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[0093] In an embodiment, the PDM 114d of the digital wallet is adapted to compare the purpose of the electronic transaction request with the purpose of the electronic cash as stored in the digital wallet at step 430. The electronic cash stored in the digital wallet is allocated and divided for specific purposes such as medical insurance, Leave travel allowances and other such purposes where the funding is provided by a third party to the user 5 of the digital wallet. However, this should not be construed as a limitation to the present invention. The user of the digital wallet may store his personal electronic cash into the digital wallet.
[0094] In an embodiment, on comparison, if the purpose of electronic 10 transaction request matches with the purpose of the electronic cash stored in the digital wallet, then the method 700 moves to step 435 and the electronic transaction is carried and payment is made to the transaction terminal.
[0095] In another embodiment, on comparison, if the purpose of the electronic 15 transaction request does not match with the purpose of the electronic cash stored in the digital wallet, then the method 700 moves to step 440, in which the user of the digital wallet is prompted if the user wants to make the payment from the global currency which may be his personal electronic cash. If the user agrees to make the payment with global currency, then the method 700 moves to step 435 and payment is made to the transaction terminal. In case, if 20 the user denies to make payment using global currency, then the transaction is declined at step 445.
[0096] In an embodiment of the present invention, the funds are earmarked and possess a specific earmark information. This specific earmark information is associated 25 with a specific type of fund and which enhances the misuse of funds allocated for a specific purpose to a user. For example, if an insurance of Rs. 10,000/- is allocated for health purposes to an employee, then the earmark information associated with the fund protects the fund from being used at a restaurant. Such restricted implementation is carried out by the digital wallet. 30
[0097] In one embodiment, the communication medium, as mentioned in figures, such as communication medium 400, is a Wireless Medium over which the communication takes place. Suitable examples of the Wireless Medium include, but are not limited to, Bluetooth, Infrared and Radio Frequency Identification (RFID), Near Field 35
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Communication (NFC), Wi-Fi, ANT, or ZigBee, and other radio links. However, such examples of the communication medium should not be construed as a limitation to the present invention. Accordingly, any other communication mediums, whether wired or wireless may be employed in various embodiments of the present invention.
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[0098] Referring to Fig. 9, there is shown an example of various types of currencies that can be stored in a single digital wallet 905. The currencies comprise earned points, loyalty points, medical insurance, house rent allowances, government subsidy funds etc. The electronic cash stored in the digital wallet is allocated for specific purposes in the form of the said currencies. These funds are earmarked for specific purposes and cannot be 10 spent for other purposes.
[0099] The disclosed system and method have many advantages. The unique capability of the system relaxes a user from carrying multiple cards for different currencies. The user is required to carry a single card for multiple currencies. The feature of earmarking 15 funds does not allow the misuse of funds of the user. Additionally, the capability of reusing of earned loyalty points in variety of transactions proves to be advantageous to the user.
[00100] The present invention further attempts to provide flexibility and convenience of a cash wallet in form of a digital wallet. On the other hand, the present 20 invention does not allow any compromises on misuse of the currency or funds assigned for a specific purpose, security aspects, thereby making transactions safer, accurate and secure. For example, when compared with open nature of a physical wallet, the authentication mechanisms in the digital wallet provide a highly restrictive protection as compared to physical cash. 25
[00101] The disclosed system and method have many advantages. The unique capability of the system relaxes a user from carrying multiple cards for different currencies. The user is required to carry a single card for multiple currencies. The feature of earmarking funds does not allow the misuse of funds of the user. Additionally, the capability of reusing 30 of earned loyalty points in variety of transactions proves to be very advantageous to the user.
[00102] In addition to the advantages as above, the digital wallets of the present invention use ultra-low power wireless technologies for data transfer, this ensures that
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the wallet can be used for extended periods, in some cases several years, without the need of recharging or replacing batteries. Further, the digital wallets of the present invention assure that once two users are carrying out transactions, they are doing so in close proximity, thereby mimicking a typical cash or card transaction.
5
[00103] The present invention further precludes the need of physically touching or tapping the two devices to effect a transaction but still provides a similar level of security by placing requirements for the devices to be in close vicinity (like a few centimeters) in order to effect transactions. Accordingly, even though the users may not need to touch the digital wallets to Point of Sale (POS), they still need to bring it within a few centimeters of 10 the POS for carrying out transactions. This requirement implies an explicit authentication by requiring physical presence of the digital wallet holder and eliminates the risk of MITM (Man-In-The-Middle) attacks.
[00104] The foregoing descriptions of specific embodiments of the present 15 invention have been presented for purposes of illustration and description. They are not intended to be exhaustive or to limit the present invention to the precise forms disclosed, and obviously many modifications and variations are possible in light of the above teaching. The embodiments were chosen and described in order to best explain the principles of the present invention and its practical application, and to thereby enable others skilled in the art to best 20 utilize the present invention and various embodiments with various modifications as are suited to the particular use contemplated. It is understood that various omissions and substitutions of equivalents are contemplated as circumstances may suggest or render expedient, but such omissions and substitutions are intended to cover the application or implementation without departing from the spirit or scope of the present invention. 25
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WE CLAIM:
1. A digital wallet having electronic cash stored therein, the electronic cash allocated with a pre-defined purpose, the digital wallet capable of carrying targeted electronic transactions with various users and transaction terminals in a financial system, the digital wallet comprising: 5
a communication interface adapted to send and receive data;
a processor; and
a memory comprising:
a purpose determination module adapted to identify the purpose of a requested electronic transaction, and 10
a transaction module for carrying the said electronic transaction on the basis of identified purpose for which the said electronic transaction is being requested.
2. The digital wallet as claimed in claim 1, wherein the purpose determination 15 module accepts/declines the said electronic transaction by comparing the purpose of the said electronic transaction with the allocated purpose of the electronic cash stored in the digital wallet.
3. The digital wallet as claimed in claim 2, wherein the said electronic 20 transaction is facilitated when the purpose of the said electronic transaction matches with the allocated purpose of the electronic cash stored in the digital wallet.
4. The digital wallet as claimed in claim 2, wherein the said electronic transaction is declined when the purpose of the said electronic transaction does not match 25 with the allocated purpose of the electronic cash stored in the digital wallet.
5. The digital wallet as claimed in claim 1 further comprising an authentication module coupled to the transaction module, wherein the authentication module is adapted to authenticate a user/person wishing to use the digital wallet. 30
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6. The digital wallet as claimed in claim 1 further comprising a secure element capable of encrypting and decrypting the electronic transactions carried between digital wallet and transaction terminal.
7. The digital wallet as claimed in claim 1, wherein the electronic transaction 5 carried by the digital wallet gets synchronized with a server when either of the selected digital wallet or the at least one transaction terminal gets communicably coupled to a wide area network.
8. A method for carrying targeted electronic transaction between a digital wallet 10 as claimed in claims 1-6 and a transaction terminal in a financial system, the method comprising:
enabling at least one transaction terminal;
selecting one of one or more digital wallets, the selection being done by the at least one transaction terminal; 15
sending an electronic transaction request to the selected digital wallet from the at least one transaction terminal via a communication means;
identifying the purpose of the requested electronic transaction, identification being done by the selected digital wallet; and
accepting/declining the said electronic transaction on the basis of the identified 20 purpose of the said electronic transaction.
9. The method as claimed in claim 8, wherein the said electronic transaction is accepted/declined by comparing the purpose of the said electronic transaction with the allocated purpose of the electronic cash stored in the digital wallet. 25
10. The method as claimed in claim 9, wherein the said electronic transaction is carried when the purpose of the said electronic transaction matches with the allocated purpose of the electronic cash stored in the digital wallet.
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11. The method as claimed in claim 9, wherein the said electronic transaction is declined when the purpose of the said electronic transaction does not match with the allocated purpose of the electronic cash stored in the digital wallet.
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12. The method as claimed in claim 8, wherein the electronic transaction gets synchronized with a server when either of the selected digital wallet or the at least one transaction terminal gets communicably coupled to a wide area network.
13. The method as claimed in claim 8, wherein the one or more digital wallets and 5 the at least one transaction terminal communicate with each other via low power short range communication.
14. The method as claimed in any of the preceding claims 8-13 further comprising authenticating at least one of the one or more digital wallets. 10
15. The method as claimed in claim 8, wherein carrying the electronic transaction comprises sending and receiving of credit and debit information between the selected digital wallet and the transaction terminal.
15
16. The method as claimed in claim 12, wherein the synchronization between at least one of the one or more digital wallets and the server comprises conciliation and reconciliation of electronic transactions between at least one or more digital wallets and the transaction terminal.
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17. A system for carrying electronic transactions in a financial system, the system comprising:-
at least one server;
at least one transaction terminal in communication with the server; and
one or more digital wallets communicably coupled to the server, the digital 25 wallets comprising electronic cash stored for a pre-defined purpose, each of the digital wallet comprising,
a communication interface adapted to send and receive data;
a processor; and
a memory comprising 30
a purpose determination module-
adapted to identify the purpose of the requested electronic transaction, and
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a transaction module for carrying the said electronic transaction on the basis of identified purpose of the requested electronic transaction.
18. The system as claimed in claim 17, wherein the purpose determination module 5 accepts/declines the said electronic transaction by comparing the purpose of the said electronic transaction with the allocated purpose of the electronic cash stored in the digital wallet.
19. The system as claimed in claim 18, wherein the said electronic transaction is 10 carried when the purpose of the said electronic transaction matches with the allocated purpose of the electronic cash stored in the digital wallet.
20. The system as claimed in claim 18, wherein the said electronic transaction is declined when the purpose of the said electronic transaction does not match with the allocated 15 purpose of the electronic cash stored in the digital wallet.
21. The system as claimed in claim 17, wherein the electronic transaction carried by the digital wallet gets synchronized with the server when either of the selected digital wallet or the at least one transaction terminal gets communicably coupled to a wide area 20 network.