FIELD OF THE INVENTION
[0001] The present invention relates generally to payment transactions, and, more
particularly, to methods and systems for processing electronic payment transactions.
BACKGROUND
[0002] Due to the advent of technology, cashless modes of payments have witnessed
an upward trend. Customers find the cashless modes of payments more convenient, as they
do not have to carry cash with them for making purchases. Due to the convenience offered by
the cashless modes of payments to the customers, merchants have installed various terminal
devices, such as point-of-sale (POS) or point-of-interaction (POI) devices, for accepting
cashless payments. Typically, such terminal devices employ magnetic stripe readers or
electronic chip readers that process transaction cards, such as credit cards, debit cards, cash
cards and the like. The terminal devices can be used for performing contactless payments by
using key fobs, smartphones, and other similar electronic devices that use radio-frequency
identification (RFID) or near field communication (NFC) technologies.
[0003] However, installation of terminal devices may be expensive and often requires
additional infrastructure (in terms of?). Especially in developing countries, merchants either
have no knowledge of such terminal devices or lack knowledge of handling them. As a result,
many merchants still prefer to accept cash payments for various purchases. In such a
scenario, if customers wish to purchase products and/or services from these merchants, the
customers have to always ensure that they carry sufficient cash with them to make purchases.
This may be troublesome for some customers as they may not prefer to carry the cash and
hence would opt for a different merchant that accepts payment by means of electronic
transactions. Thus, merchants who do not possess terminal devices suffer losses, both in
terms of customers and revenue. In addition, lack of adequate number of merchants who
possess terminal devices causes inconvenience to the customers as they have to search around
for the merchants who possess such terminal devices.
[0004] In light of the foregoing, there exists a need for a solution that enables a
merchant, who possesses a terminal device which currently is mal-functioning or does not
possess the terminal device, to receive payments from customers for purchases by way of
cashless transactions.
SUMMARY
[0005] In an embodiment of the present invention, a method for processing
transactions is provided. Transaction details for a transaction are received, by a server, from a
merchant device of a first merchant. The transaction details are associated with a purchase
that a customer wants to make with the first merchant. A transaction code is generated in
response to the received transaction details and is communicated to the first merchant. The
first merchant further provides the transaction code to the customer. The transaction code,
provided by the customer, is further received from a terminal device of a second merchant.
The transaction code, received from the terminal device, is further verified by the server.
When the transaction code is successfully verified, the transaction is initiated, by the server,
based on a payment mode used by the customer to perform the transaction. Further, a
purchase amount corresponding to the purchase is debited from a customer account
associated with the payment mode, when the transaction is approved. Further, a transaction
offer is allocated to the second merchant after conducting the transaction.
[0006] In another embodiment of the present invention, a system for processing
transactions is provided. The system includes a server that includes a processor. The
processor receives transaction details of a transaction, for a purchase that a customer wants to
make with a first merchant, from a merchant device of the first merchant. The processor
generates a transaction code in response to the received transaction details and communicates
the transaction code to the first merchant. The first merchant further provides the transaction
code to the customer. The processor further receives the transaction code, provided by the
customer, from a terminal device of a second merchant. The processor further verifies the
transaction code received from the terminal device. On successful verification of the
transaction code, the processor initiates the transaction based on a payment mode used by the
customer to perform the transaction. Further, a purchase amount corresponding to the
purchase is debited from a customer account associated with the payment mode, when the
transaction is approved. Further, a transaction offer is allocated to the second merchant after
conducting the transaction.
[0007] In yet another embodiment of the present invention, a method for processing
transactions is provided. Transaction details for a transaction are received, by a server, from a
merchant device of a first merchant. The transaction details are associated with a purchase
that a customer wants to make with the first merchant at a first merchant location. A
transaction code is generated in response to the received transaction details and is
communicated to the first merchant. The first merchant provides the transaction code to the
customer. The transaction code is received, by the server, from a terminal device of a second
merchant, when the customer provides the transaction code to the second merchant at a
second merchant location. The received transaction code is verified by the server. Based on
successful verification of the transaction code, account identification information of a
customer account corresponding to a payment mode used by the customer to perform the
transaction is received from the terminal device. The transaction is initiated based on the
account identification information. Further, a purchase amount corresponding to the purchase
is debited from the customer account of the customer, when the transaction is approved.
Further, a transaction offer is allocated to the second merchant after conducting the
transaction.
BRIEF DESCRIPTION OF THE DRAWINGS
[0008] The accompanying drawings illustrate various embodiments of systems,
methods, and other aspects of the invention. It will be apparent to a person skilled in the art
that the illustrated element boundaries (e.g., boxes, groups of boxes, or other shapes) in the
figures represent one example of the boundaries. In some examples, one element may be
designed as multiple elements, or multiple elements may be designed as one element. In some
examples, an element shown as an internal component of one element may be implemented
as an external component in another, and vice versa.
[0009] Various embodiments of the present invention are illustrated by way of
example, and not limited by the appended figures, in which like references indicate similar
elements, and in which:
[0010] FIG. 1 is a block diagram that illustrates an environment for processing
transactions, in accordance with an embodiment of the present invention;
[0011] FIG. 2 is a block diagram that illustrates a payment network server of the
environment of FIG. 1, in accordance with an embodiment of the present invention;
[0012] FIG. 3 is a process flow diagram that illustrates a registration process for
registering a first merchant with the payment network server for availing an on-behalf
transaction service, in accordance with an embodiment of the present invention;
[0013] FIGS. 4A and 4B, collectively, represent a process flow diagram that
illustrates an exemplary scenario for processing transactions, in accordance with an
embodiment of the present invention;
[0014] FIG. 5 is a process flow diagram that illustrates a method for settling an onbehalf
transaction, in accordance with an embodiment of the present invention;
[0015] FIG. 6 is a flow chart that illustrates a method for registering a first merchant
with the payment network server for availing an on-behalf transaction service, in accordance
with an embodiment of the present invention;
[0016] FIGS. 7A and 7B, collectively, represent a flow chart that illustrates a method
for processing transactions, in accordance with an embodiment of the present invention;
[0017] FIG. 8 represents a flow chart that illustrates a method for settling an onbehalf
transaction, in accordance with an embodiment of the present invention;
[0018] FIG. 9 represents a high-level flow chart that illustrates a method for
processing transactions, in accordance with an embodiment of the present invention; and
[0019] FIG. 10 is a block diagram that illustrates a system architecture of a computer
system, in accordance with an embodiment of the present invention.
[0020] Further areas of applicability of the present invention will become apparent
from the detailed description provided hereinafter. It should be understood that the detailed
description of exemplary embodiments is intended for illustration purposes only and is,
therefore, not intended to necessarily limit the scope of the present invention.
DETAILED DESCRIPTION
[0021] The present invention is best understood with reference to the detailed figures
and description set forth herein. Various embodiments are discussed below with reference to
the figures. However, those skilled in the art will readily appreciate that the detailed
descriptions given herein with respect to the figures are simply for explanatory purposes as
the methods and systems may extend beyond the described embodiments. In one example,
the teachings presented and the needs of a particular application may yield multiple alternate
and suitable approaches to implement the functionality of any detail described herein.
Therefore, any approach may extend beyond the particular implementation choices in the
following embodiments that are described and shown.
[0022] References to "an embodiment", "another embodiment", "yet another
embodiment", "one example", "another example", "yet another example", "for example" and
so on, indicate that the embodiment (s) or example (s) so described may include a particular
feature, structure, characteristic, property, element, or limitation, but that not every
embodiment or example necessarily includes that particular feature, structure, characteristic,
property, element or limitation. Furthermore, repeated use of the phrase "in an embodiment"
does not necessarily refer to the same embodiment.
OVERVIEW
[0023] In various exemplary scenarios, a customer may want to purchase products
and/or services from a first merchant who currently does not have provisions for performing
electronic payment transactions using transaction cards. In such scenarios, the customer, who
wants to pay for the purchase from the first merchant using her transaction card, may be
forced to pay for the products and/or services using cash, which may not be desirable to the
customer. Thus, the customer may approach any other merchant to make the same purchase,
which results into loss of customer and revenue to the first merchant. Moreover, cash
transactions may preclude use of transaction cards for payment transactions that require
terminal devices (e.g., point-of-sale (POS) devices) equipped with electronic payment
infrastructures. As the electronic payment infrastructures may increase cost and maintenance
of the terminal devices for the first merchant, who generally have a small margin of profit,
there is a need to obviate the installation of a terminal device for every first merchant.
[0024] Various embodiments of the present invention provide a method and a system
for processing electronic payment transactions. The electronic payment transactions may be
performed by individuals, such as merchants, using POS devices for purchases that customers
want to make with the merchants. In an embodiment of the present invention, the first
merchant registers with a payment network for availing an on-behalf transaction service. In
one example, the first merchant may register with the payment network, when the first
merchant does not possess a POS device. In another example, the first merchant may register
with the payment network, when the first merchant possesses the POS device which currently
is not functioning due to reasons, such as network unavailability, power failure, faulty
machines, or the like.
[0025] The first merchant may be associated with a first merchant store at a first
merchant location and offers sale of products and/or services to the customers. The customer
who makes a purchase from the first merchant, may want to make payment for the purchase
using an electronic payment mode, for example, by using a transaction card. However, the
first merchant cannot accept the payment using the transaction card of the customer because
the POS device of the first merchant is not functioning or the first merchant does not possess
the POS device. In such a scenario, the first merchant uses her merchant device (e.g., a
smartphone) to initiate an on-behalf transaction for the purchase. The first merchant inputs
transaction details of the on-behalf transaction for the purchase by means of a service
application installed on the merchant device. The transaction details include at least one of a
purchase amount of the purchase or merchant details of the first merchant.
[0026] A server receives the transaction details from the merchant device by means of
the service application. The server generates a transaction code for the on-behalf transaction
in response to the received transaction details. The server further transmits the transaction
code to the merchant device. The first merchant provides the transaction code to the
customer. The customer goes to a second merchant store associated with a second merchant,
who possesses a POS device for performing cashless transactions. The second merchant store
may be associated with a second merchant location. The customer provides the transaction
code to the second merchant. The second merchant inputs the transaction code by way of an
interface on the POS device. The POS device transmits the transaction code to the server. The
server receives the transaction code from the POS device and verifies the transaction code.
Upon successful verification of the transaction code, the server communicates the second
merchant that the transaction code has been successfully verified. Thereafter, the second
merchant may prompt the customer to use her transaction card to perform the on-behalf
transaction using the POS device. In another example, the second merchant may use the
transaction card of the customer to perform the on-behalf transaction on behalf of the
customer. The POS device reads account identification information of a customer account
associated with the customer and transmits the account identification information of the
customer account to the server. The server receives the account identification information of
the customer account from the POS device. The server further initiates the on-behalf
transaction based on the received account identification information. The server initiates an
authorization request for authorizing the on-behalf transaction. The server further initiates an
authentication request for authenticating the customer. Upon successful authorization of the
on-behalf transaction and/or successful authentication of the customer, the purchase amount
is debited from the customer account.
[0027] Further, the server may determine merchant account details of a merchant
account associated with the first merchant based on the merchant details. The server may
further initiate credit of the purchase amount to the merchant account based on the merchant
account details. The server further allocates a transaction offer to the second merchant after
successful processing of the on-behalf transaction. The transaction offer is pertinent to one or
more new transactions other than a new on-behalf transaction that may be conducted by the
second merchant after successful processing of the on-behalf transaction. In an exemplary
embodiment, the transaction offer is associated with a merchant discount rate (MDR) that
may be waived-off on the one or more new transactions. The MDR is a processing fee that is
charged to a merchant, such as the second merchant, for payment processing services on
transactions using electronic payment modes, for example, using transaction cards. The
transaction offer allocated to the second merchant may expire based on at least one of time or
usage limit associated with the transaction offer.
[0028] Thus, the method and the system, in accordance with various embodiments of
the present invention, facilitates merchants (who do not possess POS devices, or possess the
POS devices which currently are mal-functioning) to accept cashless transactions from the
customers by way of an on-behalf transaction service.
TERMS DESCRIPTION (in addition to plain and dictionary meaning)
[0029] Server is a physical or cloud data processing system on which a server
program runs. A server may be implemented in hardware or software, or a combination
thereof. In one embodiment, the server is implemented as a computer program that is
executed on programmable computers, such as personal computers, laptops, or a network of
computer systems. The server may correspond to a merchant server, an acquirer server, a
payment network server, an issuer server, or a digital wallet server.
[0030] Merchant is an entity that offers various products and/or services in exchange
of payments. The merchant may establish a merchant account with a financial institution to
accept payments from several customers.
[0031] Issuer is a financial institution where accounts of several customers are
established and maintained. The issuer ensures payment for authorized transactions in
accordance with various payment network regulations and local legislation.
[0032] Payment network is a transaction card association that acts as an intermediate
entity between acquirers and issuers to authorize and fund transactions. Examples of payment
networks include Mastercard®, American Express®, VISA®, Discover®, Diners Club®, and
the like. The Payment network settles transactions between various acquirers and issuers,
when transaction cards are used for initiating transactions. The payment network ensures that
a transaction card used by a customer for initiating a transaction is authorized.
[0033] Payment mode refers to a means of payment using which a customer performs
transactions for various purchases. Examples of the payment mode includes a transaction
card or an electronic wallet (hereinafter, e-wallet). The transaction card is a payment device,
such as a debit card, a credit card, a prepaid card, a promotional card, a contactless card,
and/or other device that may hold identification information of an account. The transaction
card can be used by the customer to perform transactions, such as deposits and withdrawals,
credit transfers, purchase payments, and the like. In an embodiment, the transaction card may
be radio-frequency identification (RFID) or near field communication (NFC) enabled for
performing contactless payments. The e-wallet refers to a digital wallet that holds electronic
cash. The e-wallet can be used to perform transactions for various purchases.
[0034] On-behalf transaction is a type of transaction that allows a first merchant, who
does not possess a terminal device (for example, a Point-of-Sale (POS) device), to receive
payment from a customer for a purchase, when the customer wants to use an electronic
payment mode, for example, a transaction card to make the payment for the purchase. For
initiating the on-behalf transaction, the first merchant provides transaction details, including
at least a purchase amount of the purchase, by means of a service application installed on a
merchant device of the first merchant. The service application may be associated with one of
a merchant server, an acquirer server, a payment network server, an issuer server, or a digital
wallet server. A transaction code is generated in response to the transaction details. Examples
of the transaction code include a one-time password (OTP), a quick response (QR) code, a
bar code, and the like. The first merchant provides the transaction code to the customer. An
on-behalf transaction process corresponding to the purchase is conducted, when the customer
provides the transaction code to a second merchant, who possesses a terminal device for
performing cashless transactions.
[0035] Terminal device is a computing device, for example, a point-of-sale (POS)
device, a point-of-interaction (POI) device, a point-of-purchase (POP) device, and/or a near
field communication (NFC) POS device, which is used by a merchant to facilitate electronic
transactions. The terminal device may be installed in a merchant store of the merchant for
performing the electronic transactions.
[0036] Various exemplary embodiments of the present invention have been further
described in detail with reference to FIGS. 1 to 10.
[0037] FIG. 1 is a block diagram that illustrates an environment 100 for processing
transactions, in accordance with an embodiment of the present invention. The environment
100 includes a first merchant 102 in possession of a merchant device 104, a customer 106 in
possession of a transaction card 108, and a second merchant 110 in possession of a terminal
device 112. The environment 100 further includes acquirer servers 114 (such as a first
acquirer server 114A and a second acquirer server 114B), a payment network server 116, and
an issuer server 118. The merchant device 104, the terminal device 112, the first acquirer
server 114A, the second acquirer server 114B, the payment network server 116, and the
issuer server 118 may communicate with each other by way of a communication network 120
or separate communication networks established therebetween.
[0038] The first merchant 102 is an individual, who sells products and/or services to
various customers, such as the customer 106, in exchange of payments. The first merchant
102 may be associated with a first merchant store at a first merchant location where the first
merchant 102 sells the products and/or services. In one exemplary embodiment, the first
merchant store may be a retail shop, a restaurant, a supermarket, a government agency, or any
other individual business entity, such as a street vendor, that do not facilitate a merchant
terminal (e.g., a POS device) for performing electronic transactions using electronic payment
modes, such as using transaction cards. In another exemplary embodiment, the first merchant
102 possesses the merchant terminal but may not access the merchant terminal for
performing the electronic transactions due to software snafus, power failure, network issue,
or the like. Thus, in one scenario, the first merchant 102 accepts cash as a means of payment
from the customers who want to pay in cash for purchases made from the first merchant 102.
In another scenario, the first merchant 102 allows the customers to perform on-behalf
transactions, when the customers want to make payments using the electronic payment
modes. For accepting payments by way of the on-behalf transactions, the first merchant 102
requires a bank account. For example, the first merchant 102 is an account holder of a first
merchant account. The first merchant account is a bank account maintained by a financial
institution, such as a first acquirer. The first merchant account may be associated with
identification information (hereinafter, "account identification information of the first
merchant account") that includes an account number, a name of an account holder (i.e., the
first merchant 102), or the like.
[0039] Before initiating the on-behalf transactions, the first merchant 102 registers
with a payment network (e.g., Mastercard) for availing an on-behalf transaction service that
enables the first merchant 102 to carry out the on-behalf transactions. The first merchant 102
may initiate a registration request for registration with the payment network. Such
registration is a one-time process that has to be completed before allowing the first merchant
102 to perform the on-behalf transactions for the customers who want to make payments
using the electronic payment modes. The first merchant 102 accesses a mobile application
and/or a website on the merchant device 104 to initiate the registration request. The mobile
application is a set of computer executable codes that may be installed in a memory (not
shown) of the merchant device 104. The website is a group of web pages that are published
on one or more web servers. The mobile application and/or the website may be associated
with the payment network and the merchant device 104 communicates with the payment
network by means of the mobile application and/or the website. For registration, the first
merchant 102 may submit her registration information, such as a name, a contact number, an
email ID, and the account identification information, with the payment network server 116 by
way of the mobile application and/or the website. Upon successful registration, the first
merchant 102 may accept payments from the customers by means of the on-behalf
transactions.
[0040] The merchant device 104 is a communication device associated with the first
merchant 102. Examples of the merchant device 104 include, but are not limited to, a mobile
phone, a smartphone, a laptop, a tablet, a phablet, a desktop computer, or any other
communication device known in the art. The first merchant 102 uses the merchant device 104
to access the mobile application and/or the website associated with the payment network. The
merchant device 104 may be associated with registered contact information of the first
merchant 102 that is linked to the first merchant account. In one example, the registered
contact information includes a registered contact number of the first merchant 102. In another
example, the registered contact information includes a registered email ID of the first
merchant 102. The first merchant 102 uses the mobile application and/or the website on the
merchant device 104 to initiate the registration process for registering for the on-behalf
transaction service that enables the first merchant 102 to accept payments by means of the
on-behalf transactions.
[0041] Upon successful completion of the registration process, the first merchant 102
may initiate an on-behalf transaction request using the mobile application and/or the website
on the merchant device 104. For example, the first merchant 102 initiates the on-behalf
transaction request for the customer 106 who wants to make a payment for a purchase using
the transaction card 108. To initiate the on-behalf transaction request, the first merchant 102
inputs transaction details associated with the purchase using the merchant device 104. The
transaction details may include at least a purchase amount associated with the purchase. The
transaction details may further include merchant details of the first merchant 102. The
merchant details may include merchant information, such as the name, the registered contact
information, the account identification information, or the like, of the first merchant 102. In
one embodiment, the first merchant 102 may enter the merchant details along with the
purchase amount. In another embodiment, the merchant details may be retrieved from a
storage server associated with the payment network that facilitates the on-behalf transaction
service to the first merchant 102. The merchant device 104 transmits the on-behalf
transaction request including the transaction details to the payment network server 116 by
means of the mobile application and/or the website. In response to the on-behalf transaction
request, the merchant device 104 receives a transaction code from the payment network
server 116 associated with the payment network by way of the mobile application, the
website, a short message service (SMS), an email, or the like. Examples of the transaction
code include, but are not limited to, a one-time password (OTP), a quick response (QR) code,
a bar code, or a combination thereof. Thereafter, the first merchant 102 provides the
transaction code to the customer 106. The first merchant 102 may further direct the customer
106 to the second merchant 110 to complete the transaction for the purchase.
[0042] The customer 106 is an individual, who is an account holder of a customer
account. In one embodiment, the customer account is a bank account maintained by another
financial institution, such as an issuer. The issuer may further issue the transaction card 108
to the customer 106 for performing electronic transactions from the customer account. The
transaction card 108 is linked to the customer account and stores identification information of
the customer account (hereinafter, "account identification information of the customer
account") in form of an electronic chip or a machine readable magnetic strip. The account
identification information may include an account number, a name of an account holder (i.e.,
the customer 106), or the like. The transaction card 108 further has a unique card number, an
expiry date, a card security code, and a card type associated to it. The unique card number,
the expiry date, the card security code, and the card type correspond to details of the
transaction card 108. In one scenario, the transaction card 108 is a physical card, such as a
credit card, a debit card, a membership card, a charge card, an electronic cash card, a gift
card, or the like. In another scenario, the transaction card 108 may be a virtual transaction
card that is stored in a memory (not shown) of a customer device (not shown) of the customer
106. In another embodiment, the customer account is an e-wallet account maintained by an ewallet
service provider. In such a scenario, the e-wallet account is linked to an e-wallet (not
shown) that is loaded with electronic cash. The transaction card 108 or the e-wallet
corresponds to the electronic payment mode that may be used by the customer 106 to make
the payment for the purchase with the first merchant 102.
[0043] The second merchant 110 is an individual, who sells products and/or services
to various customers, such as the customer 106, in exchange of payments. The second
merchant 110 may be associated with a second merchant store at a second merchant location
where the second merchant 110 sells the products and/or services. In an exemplary
embodiment, the second merchant store may be a retail shop, a restaurant, a supermarket, a
government agency, or any other individual business entity, such as a street vendor, that
facilitates a merchant terminal, such as the terminal device 112, to perform electronic
transactions using electronic payment modes, such as using transaction cards. In such a
scenario, the second merchant 110 accepts both cash and transaction cards as means of
payment based on customer's discretion. For accepting payments made by way of the
transaction cards, the second merchant 110 needs to have a bank account. For example, the
second merchant 110 is an account holder of a second merchant account. The second
merchant account is a bank account maintained by yet another financial institution, such as a
second acquirer. The second merchant account may be associated with identification
information (hereinafter, "account identification information of the second merchant
account") that includes an account number, a name of an account holder (i.e., the second
merchant 110), or the like. The second merchant 110 may further allow the terminal device
112 to be used for conducting the on-behalf transactions initiated by other merchants, (for
example, the first merchant 102) for purchases made therefrom.
[0044] Before allowing the terminal device 112 to be used for conducting the onbehalf
transactions, the second merchant 110 initiates a registration request with the payment
network and registers for conducting the on-behalf transaction service. Such registration may
be a one-time process that has to be completed before allowing the terminal device 112 to be
used for conducting on-behalf transactions. For registration, the second merchant 110 may
submit her registration information, such as a name, a contact number, an email ID, and the
account identification information, with the payment network server 116. Upon successful
registration, the second merchant 110 may use the terminal device 112 for performing the onbehalf
transactions. The second merchant 110 may receive one or more benefits or offers
from the payment network for conducting the on-behalf transactions. For example, the second
merchant 110 may be freed from a merchant discount rate (MDR) or merchant service fee
(MSF) associated with one or more new transactions other than a new on-behalf transaction.
The MDR or MSF is a processing fee that is charged to the second merchant 110 for payment
processing services on transactions using electronic payment modes, for example, the
transaction card 108. Also, it may create a positive impact in her ratings in a MATCH
database associated with the payment network.
[0045] The terminal device 112 is an electronic device that is used by the second
merchant 110 to perform various electronic transactions. Examples of the terminal device 112
include, but are not limited to, a POS device, a POI device, a POP device, and the like. The
terminal device 112 may be configured to present various transaction options, such as first
and second transaction options, that are selectable by the second merchant 110 to perform the
corresponding transactions. The first transaction option allows the second merchant 110 to
conduct electronic transactions corresponding to payments for purchases that are made by
customers from the second merchant 110. The second transaction option allows the second
merchant 110 to conduct the electronic transactions (i.e., the on-behalf transactions)
corresponding to payments for purchases that are made by customers from other merchants,
such as the first merchant 102. For example, the customer 106 requests the second merchant
110 for conducting the on-behalf transaction for the purchase that the customer 106 wants to
make with the first merchant 102. For conducting the on-behalf transaction, the second
merchant 110 selects the second transaction option on the terminal device 112. Upon
selecting of the second transaction option, the terminal device 112 presents a user interface
(not shown) to the second merchant 110. The second merchant 110 inputs the transaction
code, provided by the customer 106, by way of the user interface. Upon successful
verification of the transaction code by the payment network server 116, the terminal device
112 receives the transaction details, including at least the purchase amount of the purchase
made by the customer 106 with the first merchant 102, from the payment network server 116.
Thereafter, the second merchant 110 conducts the on-behalf transaction for the customer 106
using the transaction card 108. The terminal device 112 reads the account identification
information of the customer account of the customer 106 held by the transaction card 108.
Further, the terminal device 112 transmits a transaction request corresponding to the onbehalf
transaction to one of the second acquirer server 114B, the payment network server
116, or the issuer server 118 to process and settle the on-behalf transaction. In an event of
insufficient funds in the customer account, the transaction request is declined and the terminal
device 112 displays a notification representing decline of the transaction request.
[0046] The first acquirer server 114A is a computing server that is associated with the
first acquirer. The first acquirer maintains the first merchant account associated with the first
merchant 102. The first acquirer processes authorization and transaction requests, received
from a first merchant server (not shown) by using the first acquirer server 114A. The first
acquirer server 114A transmits the transaction requests to payment networks or issuers
associated with customer accounts from which the corresponding transactions are performed,
via the communication network 120. The first acquirer server 114A credits the first merchant
account in the first acquirer with a transaction amount, when the corresponding transaction is
settled.
[0047] The second acquirer server 114B is a computing server that is associated with
the second acquirer. The second acquirer maintains the second merchant account associated
with the second merchant 110. The second acquirer processes authorization and transaction
requests, received from a second merchant server (not shown) by using the second acquirer
server 114B. The second acquirer server 114B transmits the transaction requests to payment
networks or issuers associated with customer accounts from which the corresponding
transactions are performed, via the communication network 120. The second acquirer server
114B credits the second merchant account in the second acquirer with a transaction amount,
when the corresponding transaction is settled.
[0048] The payment network server 116 is a computing server that is associated with
a payment network of various transaction cards. The payment network server 116 represents
an intermediate entity between the first and second acquirer servers 114A and 114B and the
issuer server 118 for authorizing and funding the transactions performed by using the
transaction cards. In one embodiment, the payment network server 116 hosts the mobile
application and/or the website which enables the customers (such as the customer 106) to
register their payment modes (such as transaction cards and/or e-wallets) for making
purchases with various merchants, such as the first and second merchants 102 and 110. The
mobile application and/or the website further offer/s the on-behalf transaction service to the
merchants, who do not possess the terminal devices, such as the terminal device 112, for
conducting the electronic transactions and have registered for such services with the payment
network server 116.
[0049] In an exemplary scenario, a merchant, such as the first merchant 102 initiates
the on-behalf transaction request for the purchase that the customer 106 wants to make from
the first merchant 102. The first merchant 102 inputs the transaction details of the purchase
by way of the mobile application and/or the website. The payment network server 116
receives the transaction details from the merchant device 104 by way of the mobile
application and/or the website and generates the transaction code for the on-behalf transaction
requested by the first merchant 102. The payment network server 116 communicates the
transaction code to the first merchant 102. The first merchant 102 further provides the
transaction code to the customer 106 to make the payment for the purchase. In one example,
the first merchant 102 may direct the customer 106 to the second merchant 110 (who
possesses the terminal device 112) to make the payment for the purchase using the
transaction card 108. In another example, the customer 106 may travel to a merchant, such as
the second merchant 110 (who possesses the terminal device 112) to make the payment for
the purchase using the transaction card 108. The transaction code may be associated with a
validity period, for example, 2 hours, 5 hours, or 24 hours, within which the customer 106
may have to make the payment through the second merchant 110 to complete the transaction
for the purchase.
[0050] The payment network server 116 receives the transaction code, inputted by the
second merchant 110, from the terminal device 112, when the customer 106 provides the
transaction code to the second merchant 110. The payment network server 116 verifies the
transaction code and upon successful verification, retrieves the transaction details associated
with the transaction code. Further, the payment network server 116 presents the transaction
details, for example, the purchase amount of the purchase, to the terminal device 112. The
payment network server 116 further receives the account identification information of the
customer account associated with the transaction card 108 from the terminal device 112,
when the second merchant 110 uses the transaction card 108 to conduct the transaction for
the purchase using the terminal device 112 (or when the customer 106 uses her transaction
card 108 to perform the transaction using the terminal device 112). The payment network
server 116 initiates an authentication of the customer 106 based on the received account
identification information. Upon successful authentication, the transaction may be approved.
Thereafter, the purchase amount corresponding to the purchase is debited from the customer
account of the customer 106. The payment network server 116 flags the transaction as an onbehalf
transaction and parks the purchase amount, debited from the customer account, at its
end. The payment network server 116 further determines the merchant account details, for
example, the account identification information of the first merchant account associated with
the first merchant 102 based on the merchant details. Based on the merchant account details,
the payment network server 116 initiates a credit of the purchase amount to the first merchant
account of the first merchant 102.
[0051] The payment network server 116 communicates the credit and/or debit of the
purchase amount to the first acquirer server 114A, the second acquirer server 114B, and the
issuer server 118 to indicate crediting and/or debiting of the customer account, the first
merchant account, and/or the second merchant account corresponding to the transaction
performed from the customer account. The payment network server 116 further allocates a
transaction offer to the second merchant 110 upon successful processing of the on-behalf
transaction. The payment network server 116 communicates the transaction offer to the
second merchant 110. The transaction offer may be applicable to the one or more new
transactions other than the new on-behalf transaction conducted by the second merchant 110
after successful processing of the on-behalf transaction. The transaction offer is associated
with the MDR that is waived-off on the one or more new transactions. The transaction offer
may expire based on at least one of time or usage limit associated with the transaction offer.
The components and functioning of the payment network server 116 are explained in
conjunction with FIG. 2. Examples of various payment networks include Mastercard,
American Express, VISA, Discover, Diners Club, and the like.
[0052] The issuer server 118 is a computing server that is associated with the issuer.
The issuer is a financial institution that manages accounts of multiple customers, such as the
customer 106. Account details of the accounts established with the issuer are stored as
account profiles in a memory (not shown) of the issuer server 118 or on a cloud server
associated with the issuer server 118. The account details may include an account balance, a
credit line, details of an account holder, transaction history of the account holder, account
identification information, details of transaction cards linked to the corresponding customer
account, or the like. The details of the account holder may include name, age, gender,
physical attributes, registered contact number, alternate contact number, registered email
address, or the like of the account holder. In an embodiment, the account details are stored in
an encrypted format to ensure data security to the customers. The issuer server 118 receives
various credit and debit requests from the payment network server 116. Based on the credit
and debit requests, the issuer server 118 credits or debits the corresponding customer
accounts of the customers, such as the customer 106.
[0053] Examples of the first acquirer server 114 A, the second acquirer server 114B,
the payment network server 116, and the issuer server 118, include, but are not limited to,
computers, laptops, mini-computers, mainframe computers, any non-transient and tangible
machines that can execute a machine-readable code, cloud-based servers, distributed server
networks, or a network of computer systems.
[0054] The communication network 120 is a medium through which content and
messages are transmitted between various entities, such as the merchant device 104, the
terminal device 112, the first acquirer server 114A, the second acquirer server 114B, the
payment network server 116, and the issuer server 118. Examples of the communication
network 120 include, but are not limited to, a wireless fidelity (Wi-Fi) network, a light
fidelity (Li-Fi) network, a local area network (LAN), a wide area network (WAN), a
metropolitan area network (MAN), a satellite network, the Internet, a fiber optic network, a
coaxial cable network, an infrared (IR) network, a radio frequency (RF) network, or any
combinations thereof. Various entities in the environment 100 may connect to the
communication network 120 in accordance with various wired and wireless communication
protocols, such as Transmission Control Protocol and Internet Protocol (TCP/IP), User
Datagram Protocol (UDP), 2nd Generation (2G), 3rd Generation (3G), 4th Generation (4G), 5th
Generation (5G) communication protocols, Long Term Evolution (LTE) communication
protocols, or any combination thereof.
[0055] FIG. 2 is a block diagram that illustrates the payment network server 116 of
the environment 100 of FIG. 1, in accordance with an embodiment of the present invention.
The payment network server 116 includes a processor 202, a memory 204, and a transceiver
206 that communicate with each other via a communication bus 208.
[0056] The processor 202 includes suitable logic, circuitry, and/or interfaces to
execute operations for facilitating electronic transactions performed by using various
electronic payment modes, such as transaction cards or e-wallets. The processor 202 performs
such operations by means of hardware techniques, and/or under the influence of program
instructions stored in the memory 204. In an embodiment, the processor 202 hosts the mobile
application or the website, which is executable on merchant devices (such as the merchant
device 104), for offering the on-behalf transaction service to the merchants (such as the first
merchant 102). The processor 202 includes a registration manager 210, a code generator 212,
an authorization manager 214, and a transaction manager 216 for offering the on-behalf
transaction service to the merchants and facilitating the corresponding transactions performed
by the customers. Examples of the processor 202 include, but are not limited to, an
application-specific integrated circuit (ASIC) processor, a reduced instruction set computing
(RISC) processor, a complex instruction set computing (CISC) processor, a fieldprogrammable
gate array (FPGA), and the like.
[0057] The memory 204 includes suitable logic, circuitry, and/or interfaces to store
information of partner issuers, acquirers, and partner merchants. The memory 204 further
stores merchant profiles of various merchants, such as the first merchant 102 and the second
merchant 110, who have registered for the on-behalf transaction service. The memory 204
further stores the customer profiles of the customers, such as the customer 106, who have
registered their payment modes with the payment network server 116. A customer profile of a
customer, such as the customer 106, includes information of the customer 106 and
information pertaining to the payment mode registered by the customer 106. Such
information is stored in an encrypted format to ensure data security to the customers. The
memory 204 further stores a set of codes, instructions, programs, or the like, which enables
the processor 202 to host the mobile application or the website. Examples of the memory 204
include a random-access memory (RAM), a read-only memory (ROM), a removable storage
drive, a hard disk drive (HDD), a flash memory, a solid-state memory, and the like.
[0058] It will be apparent to a person skilled in the art that the scope of the invention
is not limited to realizing the memory 204 in the payment network server 116, as described
herein. In another embodiment, the memory 204 may be realized in form of a database server
or a cloud storage working in conjunction with the payment network server 116, without
departing from the scope of the present invention.
[0059] The transceiver 206 includes suitable logic, circuitry, and/or interfaces that
transmits and receives data over the communication network 120 using one or more
communication network protocols under the control of the processor 202. The transceiver
206 transmits/receives various requests and messages to/from the merchant device 104, the
terminal device 112, the first and second acquirer servers 114A and 114B, the issuer server
118, or other entities that are pursuant to one or more standards for the interchange of
transaction messages (such as the IS08583 standard). Examples of the transceiver 206
include, but are not limited to, an antenna, a radio frequency transceiver, a wireless
transceiver, a Bluetooth transceiver, an ethernet port, a universal serial bus (USB) port, or any
other device configured to transmit and receive data.
[0060] The registration manager 210 includes suitable logic, circuitry, and/or
interfaces to execute operations for facilitating registration of various merchants, such as the
first and second merchants 102 and 110, who want to use the on-behalf transaction service
offered by the payment network. The registration manager 210 declines the registration of a
merchant account, when the merchant account is not verified by an entity (such as an
acquirer). The registration manager 210 creates and updates the merchant profiles of the
merchants (such as the first and second merchants 102 and 110) who have registered for the
on-behalf transaction service with the payment network server 116.
[0061] The code generator 212 includes suitable logic, circuitry, and/or interfaces to
execute operations for facilitating generation of transaction codes for the on-behalf
transactions initiated by the merchants, such as the first merchant 102. Each transaction code
generated during a defined time duration (for example, a day) is a unique code that does not
match with other transaction codes generated during the same day. Further, each transaction
code is associated with a validity period, and thus the corresponding on-behalf transaction
should be conducted before expiry of the validity period. Each transaction code and the
corresponding merchant details are stored in an encrypted format in the memory 204.
[0062] The authorization manager 214 includes suitable logic, circuitry, and/or
interfaces to execute operations for facilitating authorization of the transactions, for example,
the on-behalf transactions that are conducted by the merchants (such as the second merchant
110) using the transaction cards (such as the transaction card 108) provided by the customers
(such as the customer 106). The authorization manager 214 initiates an authorization request
for authorizing the corresponding transaction, and thereafter, communicates the authorization
request to the corresponding customer, such as the customer 106. The authorization manager
214 does not authorize the transaction, when the customer 106 declines the transaction. The
authorization manager 214 authorizes the transaction, when the customer 106 approves the
transaction.
[0063] The transaction manager 216 includes suitable logic, circuitry, and/or
interfaces to execute operations for facilitating generation of the credit or debit requests based
on the corresponding transactions that are authorized. The transaction manager 216
communicates the credit or debit requests to the acquirer servers 114 (such as the first
acquirer server 114A and/or the second acquirer server 114B) and the issuer server 118 by
way of the transceiver 206. The transaction manager 216 further initiates blocking of a
certain amount (for example, the purchase amount associated with the purchase) from a
customer account (for example, the customer account associated with the customer 106).
[0064] It will be apparent to a person skilled in the art that a third-party server that
may host the mobile application and/or the website for facilitating the on-behalf transactions
by offering the on-behalf transaction service to the merchants may also be implemented by
the block diagram of FIG. 2, without deviating from the scope of the invention. It will be
further apparent to a person skilled in the art that an acquirer server, such as the first acquirer
server 114A, may host the mobile application or the website for facilitating the on-behalf
transactions by offering the on-behalf transaction services to the merchants in a manner
similar to the payment network server 116. However, in such a scenario, the customers, such
as the customer 106, who wants to make the purchase from the first merchant 102 having the
first merchant account associated with the first acquirer server 114A, needs to go to the
second merchant 110 having the second merchant account associated with the same first
acquirer server 114A, for performing the on-behalf transaction. The functions performed by
the payment network server 116 are explained in conjunction with FIGS. 3, 4A, and 4B.
[0065] FIG. 3 a process flow diagram 300 that illustrates the registration process for
registering the first merchant 102 with the payment network server 116 for availing the onbehalf
transaction service, in accordance with an embodiment of the present invention.
[0066] The first merchant 102 uses the merchant device 104 to initiate the registration
process for the on-behalf transaction service. Prior to the registration process, the first
merchant 102 provides login credentials, for example, a merchant identifier (ID) and a
password, for logging into the mobile application (for example, a payment network
application associated with the payment network, such as, Mastercard) on the merchant
device 104. The payment network server 116 validates the login credentials. Upon successful
validation, the first merchant 102 is presented with a user interface (not shown) on the
merchant device 104 for initiating the registration process. The first merchant 102 inputs the
merchant details, for example, the name, the registered contact information, the account
identification information, or the like (as shown by arrow 302). The merchant device 104
transmits the registration request (as shown by arrow 304) including the merchant details of
the first merchant 102 to the payment network server 116 by way of the mobile application.
The transceiver 206 receives the registration request and stores it in the memory 204. The
registration manager 210 processes the registration request to initiate registration of the first
merchant 102 with the payment network server 116 for the on-behalf transaction service.
[0067] The registration manager 210 further generates a merchant identification code
for the first merchant 102 (as shown by arrow 306). The registration manager 210 stores the
merchant details and the merchant identification code as a merchant profile of the first
merchant 102 in the memory 204 (as shown by arrow 308). The registration manager 210
communicates an acknowledgement to the first merchant 102 indicating successful
registration of the first merchant 102 with the payment network server 116 (as shown by
arrow 310). The acknowledgement may further include the merchant identification code. In
one example, the registration manager 210, in conjunction with the transceiver 206, transmits
an SMS on the registered contact number of the first merchant 102 for communicating the
acknowledgement. In another example, the registration manager 210 sends an email on the
registered email ID of the first merchant 102 for communicating the acknowledgement. The
registration process for registering the second merchant 110 with the payment network server
116 for using the on-behalf transaction service is similar to the registration process of the first
merchant 102, as described above.
[0068] FIGS. 4A and 4B, collectively, represent a process flow diagram 400 that
illustrates an exemplary scenario for processing transactions, in accordance with an
embodiment of the present invention. The process flow diagram 400 illustrates the merchant
device 104, the terminal device 112, the second acquirer server 114B, the payment network
server 116, and the issuer server 118. The first merchant 102 sells the products and/or
services in the first merchant store at the first merchant location. The customer 106 may want
to purchase a product from the first merchant 102. The customer 106 further may further
want to make the payment for the purchase using the transaction card 108. However, in one
embodiment, the first merchant 102 does not possess a POS device for performing the
transaction using the transaction card 108 of the customer 106. In another embodiment, the
first merchant 102 possesses the POS device which currently is mal-functioning (due to
various reasons, such as network unavailability, power failure, faulty machines, or the like),
and hence cannot perform the transaction using the transaction card 108 of the customer 106.
In such scenarios, the first merchant 102 accesses the mobile application (or the website) of
the payment network server 116 on the merchant device 104 and initiates the on-behalf
transaction for the customer 106.
[0069] The first merchant 102 inputs the transaction details, including at least one of
the purchase amount of the purchase or the merchant details, by way of the mobile
application (as shown by arrow 402) and initiates the on-behalf transaction request (as shown
by arrow 404). The on-behalf transaction request corresponds to a request for initiating the
on-behalf transaction and includes the transaction details. The merchant device 104 transmits
the on-behalf transaction request to the payment network server 116 (as shown by arrow
406). The transaction manager 216 retrieves the merchant details of the first merchant 102
from the memory 204 based on the on-behalf transaction request (as shown by arrow 408).
For example, the on-behalf transaction request may include the merchant ID of the first
merchant 102. Based on the merchant ID of the first merchant 102, the transaction manager
216 identifies the merchant identification code of the first merchant 102, which is further
used to retrieve the merchant details of the first merchant 102 from the memory 204. In
another example, the on-behalf transaction request may include the merchant identification
code of the first merchant 102, which can be further used to identify the first merchant 102
and retrieve the merchant details of the first merchant 102 from the memory 204.
[0070] Further, the code generator 212 generates the transaction code for the onbehalf
transaction initiated by the first merchant 102 (as shown by arrow 410). The code
generator 212 stores a copy of the transaction code against the merchant ID or the merchant
identification code of the first merchant 102 in the memory 204. Further, the transceiver 206
transmits the transaction code to the merchant device 104 (as shown by arrow 412). The first
merchant 102 provides the transaction code to the customer 106. In one example, the first
merchant 102 may direct the customer 106 to the second merchant 110. In another example,
the first merchant 102 may provide location information of the second merchant 110, who
has been identified by the payment network server 116. In yet another example, the customer
106 may travel to the second merchant 110 based on her preference.
[0071] Upon reaching the second merchant location associated with the second
merchant 110, the customer 106 provides the transaction code to the second merchant 110.
The second merchant 110 selects the second transaction option (i.e., an on-behalf transaction
option) on the user interface of the terminal device 112 (as shown by arrow 414). The
terminal device 112 prompts the second merchant 110 to enter the transaction code (as shown
by arrow 416). The second merchant 110 inputs the transaction code provided by the
customer 106. The terminal device 112 transmits the transaction code to the second acquirer
server 114B (as shown by arrow 418). The second acquirer server 114B transmits the
transaction code to the payment network server 116 (as shown by arrow 420). The code
generator 212 verifies the received transaction code (as shown by arrow 422). For example,
the code generator 212 compares the transaction code received from the terminal device 112
with the copy of the transaction code stored in the memory 204. Such comparison of the
received transaction code with the stored transaction code may be performed based on the
merchant ID or the merchant identification code associated with the transaction code. The
process flow diagram 400 illustrates a scenario where the transaction code received from the
terminal device 112 matches with the transaction code transmitted to the merchant device
104. Thus, verification of the transaction code is successful. In case verification of the
transaction code is not successful, the on-behalf transaction is declined.
[0072] Further, the code generator 212 performs a check to determine whether the
transaction code is valid or invalid based on the validity period associated with the
transaction code. In case the validity period of the transaction code has expired, the on-behalf
transaction is declined. However, if the validity period of the transaction code has not
expired, the transaction manager 216 retrieves the transaction details (for example, the
purchase amount associated with the purchase) from the memory 204 (as shown by arrow
424). The transaction manager 216 further transmits the transaction details to the second
acquirer server 114B (as shown by arrow 426). The second acquirer server 114B further
transmits the transaction details to the terminal device 112 (as shown by arrow 428). The
terminal device 112 displays the transaction details, for example, the purchase amount
associated with the purchase.
[0073] Upon display of the purchase amount on the terminal device 112, the second
merchant 110 may select the payment mode on the terminal device 112 as a transaction card
payment mode for conducting the transaction corresponding to the purchase amount (as
shown by arrow 430). The second merchant 110 may also prompt the customer 106 to use her
transaction card 108 for performing the transaction. The terminal device 112 reads the
account identification information of the customer account associated with the transaction
card 108 (as shown by arrow 432). The account identification information read by the
terminal device 112 includes information, such as the account number, the card number of the
transaction card 108, and the like.
[0074] The terminal device 112 further transmits the account identification
information of the customer account to the second acquirer server 114B (as shown by arrow
434). The second acquirer server 114B further transmits the account identification
information of the customer account to the payment network server 116 (as shown by arrow
436). Based on the account identification information of the customer account, the transaction
manager 216 identifies the issuer associated with the customer account and initiates the
transaction corresponding to the purchase amount (as shown by arrow 438). To initiate the
transaction, the authorization manager 214 transmits the authorization request to the issuer
server 118 (as shown by arrow 440) to authorize the transaction. In one scenario, the issuer
server 118 may perform authentication of the customer 106 before authorizing the
transaction. The issuer server 118 may use one or more authentication techniques that are
known in the art for authenticating the customer 106. Upon successful authentication of the
customer 106 and/or the successful authorization of the transaction, the issuer server 118
debits the purchase amount from the customer account (as shown by arrow 442). The issuer
server 118 further transmits a transaction notification indicating successful transaction along
with the purchase amount (debited from the customer account) to the payment network server
116 (as shown by arrow 444). The payment network server 116 flags the transaction as the
on-behalf transaction (as shown by arrow 446) and parks the purchase amount against the
first merchant 102. The payment network server 116 further transmits the transaction
notification to the second acquirer server 114B (as shown by arrow 448). In one embodiment,
the second acquirer server 114B may also flag the transaction as an on-behalf transaction.
The second acquirer server 114B further transmits the transaction notification to the terminal
device 112 (as shown by arrow 450). The terminal device 112 presents the transaction
notification to the second merchant 110. The payment network server 116 also transmits the
transaction notification to the merchant device 104 of the first merchant 102 (as shown by
arrow 452).
[0075] Upon successful processing of the on-behalf transaction, the payment network
server 116 allocates the transaction offer to the second merchant 110. The transaction offer
may be pertinent to the one or more new transactions for purchases that the customers want to
make from the second merchant 110. In an exemplary embodiment, the transaction offer is
associated with the MDR that may be waived-off on the one or more new transactions. The
transaction offer may expire based on at least one of the time or usage limit associated with
the transaction offer. The payment network server 116 may further communicate the
transaction offer to the second merchant 110. For example, the transaction offer may be
communicated by means of an SMS on the registered contact number of the second merchant
110 or an email on the registered email ID of the second merchant 110.
[0076] In an exemplary scenario, the second merchant 110 uses the terminal device
112 to initiate a new transaction for a new purchase that a new customer wants to make from
the second merchant store associated with the second merchant 110. For the simplicity of the
ongoing discussion, the customer 106 is considered as the new customer and the transaction
card 108 is considered as a new transaction card that is used by the customer 106 to make a
payment for the new purchase from the second merchant 110. However, a person skilled in
the art will understand that the scope of the present invention is not limited to the customer
106 being the new customer and the transaction card 108 being the new transaction card. The
new customer may be any other customer who uses her transaction card to make the payment
for the new purchase.
[0077] For the new transaction, the terminal device 112 reads the account
identification information of the customer account associated with the transaction card 108
(as shown by arrow 454). The account identification information read by the terminal device
112 includes information, such as the account number, the card number of the transaction
card 108, and the like. The terminal device 112 further transmits the account identification
information of the customer account to the second acquirer server 114B (as shown by arrow
456). The second acquirer server 114B further transmits the account identification
information of the customer account to the payment network server 116 (as shown by arrow
458). Based on the account identification information of the customer account, the transaction
manager 216 identifies the issuer associated with the customer account and initiates the new
transaction corresponding to the purchase amount (as shown by arrow 460). To initiate the
new transaction, the authorization manager 214 transmits a new authorization request to the
issuer server 118 (as shown by arrow 462) to authorize the new transaction. In one scenario,
the issuer server 118 may perform authentication of the customer 106 before authorizing the
new transaction. Upon successful authentication of the customer 106 and/or the successful
authorization of the new transaction, the issuer server 118 debits a purchase amount
(corresponding to the new transaction) from the customer account (as shown by arrow 464).
The issuer server 118 further transmits a transaction notification indicating successful
transaction along with the purchase amount (debited from the customer account) to the
payment network server 116 (as shown by arrow 466).
[0078] The payment network server 116 determines the transaction offer associated
with the second merchant 110 (as shown by arrow 468). The payment network server 116
further determines that the transaction offer has not expired and can be used for only one
transaction. In such a scenario, the payment network server 116 attaches a flag to the
transaction notification indicating the transaction offer (i.e., the ongoing transaction is free
from MDR charges). The payment network server 116 further transmits the transaction
notification to the second acquirer server 114B (as shown by arrow 470). Further, the second
acquirer server 114B credits the purchase amount to the second merchant account and does
not charge the MDR for the new transaction. The second acquirer server 114B further
transmits the transaction notification to the terminal device 112 (as shown by arrow 472)
indicating successful processing of the new transaction.
[0079] FIG. 5 is a process flow diagram 500 that illustrates a method for settling the
on-behalf transactions, in accordance with an embodiment of the present invention. The
process flow diagram 500 illustrates the merchant device 104, the terminal device 112, the
first acquirer server 114A, the second acquirer server 114B, the payment network server 116,
and the issuer server 118. The terminal device 112 transmits a first settlement request to the
second acquirer server 114B to settle the on-behalf transactions performed by the second
merchant 110 (as shown by arrow 502). The first settlement request includes the transaction
details associated with the purchase and the account identification information of the
customer account. The process flow diagram 500 illustrates an exemplary scenario where
only transaction is being processed for settlement. However, it will be apparent to a person
skilled in the art that multiple transactions may be settled in a batch.
[0080] The second acquirer server 114B transmits the first settlement request to the
payment network server 116 (as shown by arrow 504). The payment network server 116
identifies the issuer based on the account identification information and transmits the first
settlement request to the issuer server 118 (as shown by arrow 506). The issuer debits the
purchase amount from the customer account of the customer 106 (as shown by arrow 508)
and parks the purchase amount with the payment network server 116 or the issuer server 118.
The issuer server 118 transmits a first settlement notification to the payment network server
116 (as shown by arrow 510). The payment network transfers the purchase amount to the
second acquirer server 114B for performing the settlement (as shown by arrow 512). The
payment network server 116 further determines that the purchase amount is associated with a
flagged transaction indicating that the transaction is the on-behalf transaction (as shown by
arrow 514). The payment network server 116 further transmits a second settlement request to
the second acquirer server 114B to instruct the second acquirer to credit the purchase amount
to the first merchant account associated with the first merchant 102 (as shown by arrow 516).
The second acquirer transfers the purchase amount to the first acquirer (as shown by arrow
518). The second acquirer server 114B transmits a second settlement notification to the first
acquirer server 114 A, indicating transfer of the purchase amount (as shown by arrow 520) to
the first merchant account. The first acquirer further credits the purchase amount to the first
merchant account (as shown by arrow 522). The first acquirer server 114A transmits a third
settlement notification to the merchant device 104, indicating the credit of the purchase
amount to the first merchant account (as shown by arrow 524).
[0081] FIG. 6 is a flow chart 600 that illustrates a method for registering the first
merchant 102 with the payment network server 116 for availing the on-behalf transaction
service, in accordance with an embodiment of the present invention.
[0082] At step 602, the first merchant 102 inputs her merchant details to initiate the
registration request by way of the mobile application or the website on the merchant device
104. At step 604, the merchant device 104 transmits the registration request to the payment
network server 116. At step 606, the registration manager 210 generates the merchant
identification code for the first merchant 102. At step 608, the registration manager 210 stores
the merchant details and the merchant identification code as the merchant profile of the first
merchant 102 in the memory 204. At step 610, the registration manager 210 transmits the
acknowledgement, indicating successful registration of the first merchant 102 with the
payment network for availing the on-behalf transaction service, to the merchant device 104.
[0083] FIGS. 7A and 7B, collectively, represent a flow chart 700 that illustrates a
method for processing transactions, in accordance with an embodiment of the present
invention.
[0084] At step 702, the payment network server 116 receives the transaction request
from the merchant device 104. The transaction request corresponds to the on-behalf
transaction associated with the purchase made by the customer 106 from the first merchant
102. The transaction request includes the transaction details, such as the purchase amount
associated with the purchase, and/or the merchant details (such as the merchant ID or
merchant identification code associated with the first merchant 102). At step 704, the
transaction manager 216 retrieves the merchant details of the first merchant 102 from the
memory 204 based on the transaction request. In another embodiment, the transaction
manager 216 retrieves the merchant details of the first merchant 102 from the transaction
request and stores it in the memory 204.
[0085] At step 706, the code generator 212 generates the transaction code for the onbehalf
transaction. At step 708, the transceiver 206 transmits the transaction code to the
merchant device 104. The first merchant 102 provides the transaction code to the customer
106. The customer 106 goes to the second merchant location and provides the transaction
code to the second merchant 110. The second merchant 110 inputs the transaction code by
way of the terminal device 112. The terminal device 112 transmits the transaction code to the
second acquirer server 114B. The second acquirer server 114B further transmits the
transaction code to the payment network server 116.
[0086] At step 710, the transceiver 206 receives the transaction code form the
terminal device 112. At step 712, the code generator 212 verifies the transaction code
received from the terminal device 112. The transaction code is verified by comparing the
received transaction code with the stored transaction code. The stored transaction code may
be retrieved from the memory 204 based on the merchant ID or the merchant identification
code associated with the received transaction code.
[0087] At step 714, a check is performed to determine whether verification of the
transaction code is successful or unsuccessful. If, at step 714, verification of the transaction
code is determined as unsuccessful, then step 716 is performed. At step 716, the transaction
manager 216 declines the on-behalf transaction. The transaction manager 216 further
transmits the transaction declined notification to the second acquirer server 114B by way of
the transceiver 206. The second acquirer server 114B further transmits the transaction
declined notification to terminal device 112. The terminal device 112 displays the transaction
declined notification to the second merchant 110.
[0088] If, at step 714, verification of the transaction code is determined as successful,
then step 718 is performed. At step 718, the transaction manager 216 retrieves the transaction
details of the on-behalf transaction from the memory 204. At step 720, the transaction
manager 216 transmits the transaction details to the second acquirer server 114B by way of
the transceiver 206. The second acquirer server 114B transmits the transaction details to the
terminal device 112. At step 722, the second merchant 110 selects a payment mode at the
terminal device 112. Thereafter, the second merchant 110 uses the transaction card 108 for
the conducting the on-behalf transaction. The terminal device 112 reads the account
identification information of the customer account associated with the transaction card 108
and transmits the account identification information of the customer account to the payment
network server 116.
[0089] At step 724, the transceiver 206 receives the account identification
information of the customer account. At step 726, the transaction manager 216 initiates the
on-behalf transaction based on the account identification information. At step 728, the
transaction manager 216 transmits the authorization request to the issuer server 118 for
authorizing the on-behalf transaction.
[0090] At step 730, a check is performed to determine approval of the on-behalf
transaction. If, at step 730, it is determined that the on-behalf transaction is not approved,
then step 732 is performed. At step 732, the issuer server 118 declines the on-behalf
transaction. If, at step 730, it is determined that the on-behalf transaction is approved, then
step 734 is performed. At step 734, the issuer server 118 captures the transaction details, for
example, the purchase amount of the purchase. The issuer server 118 may debit the purchase
amount from the customer account of the customer 106. The issuer server 118 further
transmits a transaction notification indicating successful transaction to the payment network
server 116.
[0091] At step 736, the payment network server 116 transmits the transaction
notification to the second acquirer server 114B. The second acquirer server 114B further
transmits the transaction notification to the terminal device 112. The payment network server
116 may also transmit the transaction notification to the merchant device 104. At step 738,
the payment network server 116 flags the on-behalf transaction for the final settlement.
[0092] FIG. 8 represents a flow chart 800 that illustrates a method for settling the onbehalf
transaction, in accordance with an embodiment of the present invention.
[0093] At step 802, the payment network server 116 receives the first settlement
request from the second acquirer server 114B. At step 804, the payment network server 116
transmits the first settlement request to the issuer server 118. Based on the first settlement
request, the issuer server 118 transfers the purchase amount, debited from the customer
account of the customer 106, to the payment network. At step 806, the payment network
server 116 receives the first settlement notification from the issuer server 118.
[0094] At step 808, the payment network transfers the purchase amount to the second
acquirer. At step 810, the payment network server 116 transmits the first settlement
notification to the second acquirer server 114B, indicating the transfer of the purchase
amount. At step 812, the payment network server 116 identifies that the transaction is flagged
as the on-behalf transaction. At step 814, the payment network server 116 transmits the
second settlement request to the second acquirer server 114B. Based on the second settlement
request, the second acquirer credits the purchase amount to the first acquirer. The first
acquirer further credits the purchase amount to the first merchant account of the first
merchant 102.
[0095] FIG. 9 represents a high-level flow chart 900 that illustrates the method for
processing transactions, in accordance with an embodiment of the present invention.
[0096] At step 902, the payment network server 116 receives the transaction details of
the transaction for the purchase that the customer 106 wants to make with a first merchant
102 associated with the first merchant location. At step 904, the payment network server 116
generates the transaction code in response to the received transaction details. At step 906, the
payment network server 116 communicates the transaction code to the first merchant 102.
The first merchant 102 provides the transaction code to the customer 106. At step 908, the
payment network server 116 receives the transaction code from the terminal device 112,
when the second merchant 110 (associated with the second merchant location) inputs the
transaction code provided by the customer 106.
[0097] At step 910, the payment network server 116 verifies the received transaction
code based on the transaction code communicated to the first merchant 102. At step 912, the
payment network server 116 receives the account identification information of the customer
account of the customer 106 from the terminal device 112, based on successful verification of
the received transaction code. At step 914, the payment network server 116 initiates the onbehalf
transaction based on the received account identification information.
[0098] Referring now to FIG. 10, a block diagram that illustrates a system
architecture of a computer system 1000, in accordance with an embodiment of the present
invention, is shown. An embodiment of present invention, or portions thereof, may be
implemented as computer readable code on the computer system 1000. In one example, the
merchant device 104, the first and second acquirer servers 114A and 114B, the payment
network server 116, and the issuer server 118 may be implemented in the computer system
1000 using hardware, software, firmware, non-transitory computer readable media having
instructions stored thereon, or a combination thereof and may be implemented in one or more
computer systems or other processing systems. Hardware, software, or any combination
thereof may embody modules and components used to implement the methods of FIGS. 6-9.
[0099] The computer system 1000 includes a main processor 1002 that may be a
special purpose or a general-purpose processing device. The main processor 1002 may be a
single processor, multiple processors, or combinations thereof. The main processor 1002 may
have one or more processor "cores." In one example, the main processor 1002 is an octa-core
processor. Further, the main processor 1002 may be connected to a communication
infrastructure 1004, such as a bus, message queue, the communication bus 208, multi-core
message-passing scheme, and the like. The computer system 1000 further includes a main
memory 1006 and a secondary memory 1008. Examples of the main memory 1006 may
include RAM, ROM, dynamic RAM (DRAM), and the like. The secondary memory 1008
may include a hard disk drive or a removable storage drive, such as a floppy disk drive, a
magnetic tape drive, a compact disc, an optical disk drive, a flash memory, and the like.
Further, the removable storage drive may read from and/or write to a removable storage
device in a manner known in the art. In one example, if the removable storage drive is a
compact disc drive, the removable storage device may be a compact disc. In an embodiment,
the removable storage unit may be a non-transitory computer readable recording media.
[00100] The computer system 1000 further includes an input/output (I/O) interface
1010 and a communication interface 1012. The I/O interface 1010 includes various input and
output devices that are configured to communicate with the main processor 1002. Examples
of the input devices may include a keyboard, a mouse, a joystick, a touchscreen, a
microphone, and the like. Examples, of the output devices may include a display screen, a
speaker, headphones, and the like. The communication interface 1012 may allow data to be
transferred between the computer system 1000 and various devices that are communicatively
coupled to the computer system 1000. Examples of the communication interface 1012 may
include a modem, a network interface, i.e., an Ethernet card, a communications port, and the
like. Data transferred via the communication interface 1012 corresponds to signals, such as
electronic, electromagnetic, optical, or other signals as will be apparent to a person skilled in
the art. The signals may travel via a communication channel (not shown) which transmits the
signals to devices that are communicatively coupled to the computer system 1000. Examples
of the communication channel include, but are not limited to, a cable, fiber optics, a phone
line, a cellular phone link, or a radio frequency link.
[00101] Computer program medium and computer usable medium may refer to a nontransitory
computer readable medium, such as the main memory 1006 and the secondary
memory 1008, which may be a semiconductor memory such as a DRAM. The computer
program medium may provide data that enables the computer system 1000 to implement the
methods illustrated in FIGS. 6-9. In an embodiment, the present invention is implemented
using a computer implemented application, the computer implemented application may be
stored in a computer program product and loaded into the computer system 1000 using the
removable storage drive or the hard disc drive in the secondary memory 1008, the I/O
interface 1010, or the communication interface 1012.
[00102] A person having ordinary skill in the art will appreciate that embodiments of
the disclosed subject matter can be practiced with various computer system configurations,
including multi-core multiprocessor systems, minicomputers, mainframe computers,
computers linked or clustered with distributed functions, as well as pervasive or miniature
computers that may be embedded into virtually any device. For instance, at least one
processor such as the main processor 1002 and a memory such as the main memory 1006 and
the secondary memory 1008 implements the above described embodiments. Further, the
operations may be described as a sequential process, however some of the operations may in
fact be performed in parallel, concurrently, and/or in a distributed environment, and with
program code stored locally or remotely for access by single or multiprocessor machines. In
addition, in some embodiments the order of operations may be rearranged without departing
from the spirit of the disclosed subject matter.
[00103] Thus, various embodiments of the present invention facilitate a technique
where customers (e.g., the customer 106) can use their transaction cards (e.g., the transaction
card 108) to perform payment transactions for purchases at an outlet of a retailer (e.g., the
first merchant 102) who currently does not have electronic payment infrastructure (e.g., POS
devices) for conducting electronic transactions, or the electronic payment infrastructure
currently is mal-functioning. In such scenarios, the customer 106 may make payments for the
purchases from the first merchant 102 at another outlet of another retailer (e.g., the second
merchant 110) using her transaction card 108. Thus, the customer 106 may not have to
necessarily carry cash while making purchases from retailers, such as the first merchant 102.
Also, the first merchant 102 does not suffer losses in terms of customers as well as revenue.
Also, for conducting such transactions (e.g., on-behalf transactions), the second merchant 110
receives benefits and offers from payment networks (e.g., Mastercard). For example, the
second merchant 110 may be freed from MDRs associated with new transactions (other than
a new on-behalf transaction). Also, it creates a positive impact in her ratings in a MATCH
database associated with the payment networks.
[00104] Techniques consistent with the present invention provide, among other
features, systems and methods for processing payment transactions. While various exemplary
embodiments of the disclosed system and method have been described above it should be
understood that they have been presented for purposes of example only, not limitations. It is
not exhaustive and does not limit the invention to the precise form disclosed.
[00105] In the claims, the words 'comprising', 'including' and 'having' do not exclude
the presence of other elements or steps then those listed in a claim. The terms "a" or "an," as
used herein, are defined as one or more than one. Unless stated otherwise, terms such as
"first" and "second" are used to arbitrarily distinguish between the elements such terms
describe. Thus, these terms are not necessarily intended to indicate temporal or other
prioritization of such elements. The fact that certain measures are recited in mutually
different claims does not indicate that a combination of these measures cannot be used to
advantage.
[00106] While various embodiments of the present invention have been illustrated and
described, it will be clear that the present invention is not limited to these embodiments only.
Numerous modifications, changes, variations, substitutions, and equivalents will be apparent
to those skilled in the art, without departing from the spirit and scope of the present invention,
as described in the claims.

We Claim:
1. A method for processing transactions, the method comprising:
receiving, by a server, from a merchant device of a first merchant, transaction details
of a transaction for a purchase that a customer wants to make with the first merchant;
generating, by the server, a transaction code for the transaction in response to the
received transaction details, wherein the transaction code is provided to the customer;
receiving, by the server, from a terminal device of a second merchant, the
transaction code provided by the customer;
verifying, by the server, the transaction code received from the terminal device; and
initiating, by the server, the transaction based on a payment mode used by the
customer to perform the transaction, when the transaction code is successfully verified,
wherein a transaction offer is allocated to the second merchant after conducting the
transaction.
2. The method of claim 1, further comprising:
receiving, by the server, from the merchant device, a registration request, including
registration information of the first merchant, for registering the first merchant for an onbehalf
transaction service.
3. The method of any of claims 1 and 2, wherein the transaction details include at least one of
a purchase amount of the purchase or merchant details of the first merchant.
4. The method of any of claims 1 to 3, wherein the transaction code is associated with a
validity period for initiating the transaction after generation of the transaction code.
5. The method of any of claims 1 to 4, further comprising:
rendering, by the server, on the terminal device, a user interface, when the second
merchant selects a transaction option as an on-behalf transaction option on the terminal
device, wherein the second merchant inputs the transaction code provided by the customer
by way of the user interface.
6. The method of any of claims 1 to 5, further comprising:
identifying, by the server, the first merchant based on the transaction code, when the
transaction code received from the terminal device is successfully verified; and
transmitting, by the server, the transaction details associated with the purchase to the
terminal device.
7. The method of any of claims 1 to 6, further comprising:
receiving, by the server, account identification information of a customer account
corresponding to the payment mode used by the customer to perform the transaction; and
initiating, by the server, an authentication of the customer based on the received
account identification information, wherein the transaction is approved based on
successful authentication of the customer, and wherein a purchase amount corresponding
to the purchase is debited from the customer account, when the transaction is approved.
8. The method of any of claims 1 to 7, further comprising:
flagging, by the server, the transaction as an on-behalf transaction, when the
transaction is approved; and
communicating, by the server, the transaction offer to the second merchant, when
the transaction is flagged, wherein the transaction offer is pertinent to one or more new
transactions other than a new on-behalf transaction conducted by the second merchant
after successful processing of the transaction.
9. The method of any of claims 1 to 8, wherein the transaction offer is associated with a
merchant discount rate (MDR) that is waived-off on the one or more new transactions, and
wherein the transaction offer expires based on at least one of time or usage limit associated
with the transaction offer.
10. The method of any of claims 1 to 9, further comprising:
determining, by the server, merchant account details of a merchant account
associated with the first merchant based on the merchant details; and
initiating, by the server, a credit of the purchase amount to the merchant account
based on the merchant account details.
11. A system for processing transactions, comprising:
a server comprising:
a processor that is configured to:
receive, from a merchant device of a first merchant, transaction details of
a transaction for a purchase that a customer wants to make with the first
merchant;
generate a transaction code for the transaction in response to the received
transaction details, wherein the transaction code is provided to the customer;
receive, from a terminal device of a second merchant, the transaction
code provided by the customer;
verify the transaction code received from the terminal device; and
initiate the transaction based on a payment mode used by the customer to
perform the transaction, when the transaction code is successfully verified,
wherein a transaction offer is allocated to the second merchant after
conducting the transaction.
12. The system of claim 11, wherein the transaction details include at least one of a purchase
amount of the purchase or merchant details of the first merchant.
13. The system of any of claims 11 and 12, wherein the transaction code is associated with a
validity period for initiating the transaction after generation of the transaction code.
14. The system of any of claims 11 to 13, wherein the processor is further configured to:
render, on the terminal device, a user interface, when the second merchant selects a
transaction option as an on-behalf transaction option on the terminal device, wherein the
second merchant inputs the transaction code provided by the customer by way of the user
interface.
15. The system of any of claims 11 to 14, wherein the processor is further configured to:
identify the first merchant based on the transaction code, when the transaction code
received from the terminal device is successfully verified; and
transmit the transaction details associated with the purchase to the terminal device.
16. The system of any of claims 11 to 15, wherein the processor is further configured to:
receive account identification information of a customer account corresponding to
the payment mode used by the customer to perform the transaction; and
initiate an authentication of the customer based on the received account
identification information, wherein the transaction is approved based on successful
authentication of the customer, and wherein a purchase amount corresponding to the
purchase is debited from the customer account, when the transaction is approved.
17. The system of any of claims 11 to 16, wherein the processor is further configured to:
flag the transaction as an on-behalf transaction, when the transaction is approved;
and
communicate the transaction offer to the second merchant, when the transaction is
flagged, wherein the transaction offer is pertinent to one or more new transactions other
than a new on-behalf transaction conducted by the second merchant after successful
processing of the transaction.
18. The system of any of claims 11 to 17, wherein the transaction offer is associated with a
merchant discount rate (MDR) that is waived-off on the one or more new transactions, and
wherein the transaction offer expires based on at least one of time or usage limit associated
with the transaction offer.
19. The system of any of claims 11 to 18, wherein the processor is further configured to:
determine merchant account details of a merchant account associated with the first
merchant based on the merchant details; and
initiate a credit of the purchase amount to the merchant account based on the
merchant account details.
20. A method for processing transactions, the method comprising:
receiving, by a server, from a merchant device of a first merchant, transaction details
of a transaction for a purchase that a customer wants to make with the first merchant
associated with a first merchant location;
generating, by the server, a transaction code for the transaction in response to the
received transaction details;
communicating, by the server, the transaction code to the first merchant, wherein the
first merchant provides the transaction code to the customer;
receiving, by the server, from a terminal device of a second merchant, the
transaction code, when the customer provides the transaction code to the second merchant
associated with a second merchant location;
verifying, by the server, the transaction code received from the terminal device;
receiving, by the server, from the terminal device, account identification information
of a customer account corresponding to a payment mode used by the customer to perform
the transaction, based on successful verification of the transaction code; and
initiating, by the server, the transaction based on the account identification
information, wherein a purchase amount corresponding to the purchase is debited from the
customer account of the customer, when the transaction is approved, and wherein a
transaction offer is allocated to the second merchant after conducting the transaction