Patent Grant
7765161
The present invention relates generally to the field of facilitating electronic commerce by providing services via a public key infrastructure.
The world of electronic commerce has created new challenges to establishing relationships between contracting parties. One of those challenges springs from the fact that the parties to the transaction cannot see or hear each other, and cannot otherwise easily confirm each other's identity and authority to act.
One remedy for this problem is to provide each contracting party with a private key for signing transmitted messages. The signing party makes available an associated public key that decrypts messages signed with the party's private key, and thus enables a receiving party to confirm the identity of the sender.
But the sender's public key may not be known a priori to the recipient. In that event, the sender may transmit with its signed message a digital certificate issued by a certificate authority. The certificate is itself a signed electronic document (signed with the private key of the certificate authority) certifying that a particular public key is the public key of the sender.
In some cases, the recipient may be unfamiliar with the public key of the certificate authority or may not know whether the certificate is still valid. In that event, the recipient may wish to check the authenticity and validity of the certificate with an entity that it trusts. One known protocol for checking certificate status is the on-line certificate status protocol (OCSP).
Another challenge facing electronic commerce relates to payments and the establishment of payment systems. In some cases, purchasers pay for goods purchased over the Internet by transmitting a credit card number to a merchant. Security risks and other drawbacks associated with this practice make it undesirable even for business-to-consumer transactions, and unacceptable for most business-to-business ones.
Several electronic payment systems have also been proposed, including ones that employ digital certificates to authenticate the identity of a payor. These systems, however, do not provide the array of payment instruments required for modern electronic commerce, especially business-to-business electronic commerce, and often fail to provide an adequate infrastructure to securely and verifiably effect electronic payments.
A system and method are disclosed for providing a plurality of payment services to facilitate electronic commerce. In a preferred embodiment, these services are provided within the context of a four-corner trust model. The four-corner model comprises a buyer, also referred to as the subscribing customer, and a seller, also referred to as the relying customer, who engage in an on-line transaction. The buyer is a customer of a first financial institution, referred to as an issuing participant. The issuing participant acts as a certificate authority for the buyer and issues the buyer a hardware token including a private key and a digital certificate signed by the issuing participant. The seller is a customer of a second financial institution, referred to as the relying participant. The relying participant acts as a certificate authority for the seller and issues the seller a hardware token including a private key and a digital certificate signed by the relying participant. The system also includes a root certificate authority that issues digital certificates to the issuing and relying participants.
One benefit of the four-corner model is that trust between a buyer and seller does not depend on each party using the same certifying authority to validate digital certificates, or identity, to each other. Rather, the buyer and seller each look, in the first instance, to their respective banks for such validations. In turn, the buyer's and seller's banks look to the root entity to provide the necessary bridge that enables them to confidently validate the identity of one party to another and the integrity of the messages they exchange.
The present system and method leverage this trust model to provide enhanced payment services to buyers and sellers. The four-corner trust model and pre-established banking relationships between the parties and their respective banks enable the parties to complete an on-line purchase or trade and simultaneously arrange for a secure, efficient and, optionally, guaranteed payment. Moreover, use in the present system of digitally signed payment instructions provides authentication, message integrity, non-repudiation, and confidentiality.
In a preferred embodiment, payment messaging in the present system proceeds from buyer to seller to seller's bank to buyer's bank. Thus, for example, a buyer may execute a payment instruction and forward it to the seller who in turn forwards it to the seller's bank for ultimate delivery to, and payment by, the buyer's bank.
The present system and method operate efficiently in part because parties have pre-established payment authorization, routing, and settlement instructions with their banks, which enable the parties to initiate an on-line payment that is simultaneous with the transaction, rather than through a separate, off-line step. Additional efficiencies are created through standardized payment processing procedures at the banks.
The present system and method provide numerous benefits to buyers. In particular, the present system and method provide a buyer with access to a variety of payment options to satisfy a seller's requirements. The buyer is also provided with improved timing and knowledge of cash flows. In addition, the present system and method enable a buyer to cover trade-inherent risks by using a conditional payment instrument. Moreover, the buyer enjoys efficient work flows, as payment and purchasing are bundled into one process. Interfacing of the present system and method with existing legacy systems also enables full electronic processing of the entire transaction.
The present system and method also provide numerous benefits to sellers. In particular, the present system and method provide a seller with the ability to offer payment terms tailored to valued clients. The seller also reduces his or her credit risk through the use of assured payments. In addition, the present system and method improve a seller's timing and knowledge of cash flows. Moreover, the seller enjoys efficient work flows, as payment and purchasing are bundled into one process. Also, if the seller is holding a payment obligation, it may ask its bank to discount the obligation, providing a source of financing to the seller. Interfacing of the present system and method with existing legacy systems also enables full electronic processing of the entire transaction.
In a preferred embodiment, the present system and method facilitate a plurality of payment instruments. These include a payment order, a payment obligation, a certified payment obligation, and conditional payments. Each of these payment instruments is described in more detail below in the detailed description.
In a preferred embodiment, the present system facilitates the creation and transfer of negotiable electronic payment instruments. For example, the present system includes a payment obligation that may preferably be sold in the secondary market. Change in the holder of these obligations may preferably be performed through use of a holder registry service.
The above summary of the invention will be better understood when taken in conjunction with the following detailed description and accompanying drawings, in which:
System Architecture and Technical Characteristics
The present disclosure relates to a system that allows financial institutions to securely provide payment services to their customers. In a preferred embodiment, these services may be provided within the context of a four-corner trust model. A preferred embodiment of the four-corner model employed by the present system is shown in
As shown in
Also shown in
First customer 106 is sometimes referred to as the “subscribing customer” because it subscribes to services provided by participant 102. First customer 106 is also sometimes referred to as the “buyer” because that is the role it typically plays in transactions in the four-corner models.
Second customer 108 is sometimes referred to as the “relying customer” because it relies on representations made by both issuing participant 102 and subscribing customer 106. Second customer 108 is also sometimes referred to as the “seller” because that is the role it typically plays in transactions in the four-corner model. It should be recognized, however, that although the description below speaks primarily in terms of a buyer 106 and a seller 108, first customer 106 and second customer 108 may instead have different roles in a given transaction. For example, first customer 106 may be a borrower repaying a loan to second customer 108.
Also shown in
Participants 102, 104 and root entity 110 are each further preferably provided with an OCSP responder 204 and hardware security module (HSM) 206. HSM 206 is adapted to sign messages and verify signatures on messages.
In addition, each participant 102, 104 and root entity 110 is further preferably provided with a billing data database 208 (connected to a bank billing application 210 in the case of participants 102, 104), a raw transaction log, 212, a customer data database 214, a risk manager 216 (connected to customer data database 214), and a hardware security module 218, each of which is connected to transaction coordinator 202.
As further shown in
As further shown in
In a preferred embodiment, each system entity is provided with two digital certificates (and corresponding private keys) to facilitate authentication: An identity certificate (also referred to, in some cases, as a warranty certificate) and a utility certificate. In addition, in a preferred embodiment, each transaction coordinator 202 is preferably provided with its own identity certificate and utility certificate and associated private keys.
The identity private key is used to produce digital signatures that are required by root entity 110 as evidence of an entity's contractual commitment to the contents of an electronic transaction. A certificate chain is needed to support operations using this key. The status of the identity certificate may be obtained by authorized entities as described, for example, in U.S. patent application Ser. No. 09/657,605, filed on Sep. 8, 2000, entitled System and Method for Providing Certificate Validation and Other Services, which is hereby incorporated by reference in its entirety into the present patent application.
The utility private key is used to produce digital signatures that allow additional transactional security. Typically, utility certificates are used to support secure socket layer sessions, to sign S/MIME messages, and for other utility applications. A certificate chain is also needed to support operations using the utility key. The status of the utility certificate, however, may not be available to a requester. Throughout this document, the term “certificate” refers to an identity certificate unless otherwise stated.
In a preferred embodiment, subscribing customer 106's digital certificates and associated private keys are provided to it by issuing participant 102. Issuing participant 102 preferably issues smart cards or other suitable instruments to subscribing customer 106 that include at least the private key associated with the subscribing customer's identity certificate. If desired, the smart card may also include the subscribing customer's identity certificate. Preferred specifications for the smart card, its manufacture, and contents are described in U.S. provisional patent application Ser. No. 60/224,944, filed Aug. 14, 2000, entitled Signing Interface Requirements, Smart Card Compliance Requirements, Warranty Service, Functional Requirements, and Additional Disclosure, which is hereby incorporated by reference in its entirety into the present patent application.
In a preferred embodiment, the present system supports at least the following Internet transport protocols: Hyper Text Transport Protocol (HTTP), Multipurpose Internet Mail Extensions (MIME), Simple Mail Transport Protocol (SMTP), and Internet Inter-ORB Protocol (IIOP). In addition, the present system preferably supports at least the following Internet transport security protocols: Secure Sockets Layer (SSL), Secure/Multipurpose Internet Mail Extensions (S/MIME), Transport Layer Security (TLS), and Secure Internet Inter-ORB Protocol (S-IIOP).
In a preferred embodiment, payment instruments in the present system are encrypted to protect confidential financial information. Due to the confidential nature of the information exchanged between all parties strong encryption is preferred. The encryption should preferably be at the message-level, in addition to any transport-level encryption.
To enable automated processing, payment messages in the present system are preferably structured to optimize fast on-line processing with certificate management services provided by the present system (e.g., certificate validation) as well as with other systems such as legacy systems that are external to the present system. Integration with the present system may include a set of MIME-based messages. Integration with other systems may include EDIFACT, XML/BizTalk and Enterprise Java Beans. These are preferred because they enable straightforward conversion into existing payment message formats.
Payment services messages in the present system are preferably signed by system entities using the private keys associated with their identity certificates. The payment services messages may be enveloped or referenced, or both, in the content of certificate management service messages.
Many of the payment messages described below require contributions from more than one party before the completed message is transmitted to the final recipient. Messages in the present system are therefore preferably structured to support signed additions to the contents while preserving non-repudiation for each signer and the final recipient.
At the very low end, a buyer 106 may typically employ a standard Internet browser such as Netscape Navigator™ or Internet Explorer™ along with some method to support applications related to the present system. Such methods may include a browser plug-in, the use of Java applets or some other technology. Technology options such as XML may also be used.
One potential implementation is to load an HTML page into browser 224 from a seller-side server containing the results of the negotiation of terms and conditions between buyer 106 and seller 108. Using a signed JAVA applet as part of the downloaded HTML page, the information can be structured and digitally signed using smart card 226. The resulting message can then be forwarded to the server for further processing. An alternative implementation approach is the use of plug-ins or helper applications, which compose and sign the payment service messages. Preferred embodiments for these implementations are described in U.S. provisional patent application Ser. No. 60/224,994, filed Aug. 14, 2000, entitled Signing Interface Requirements, Smart Card Compliance Requirements, Warranty Service, Functional Requirements, and Additional Disclosure, which is hereby incorporated by reference in its entirety into the present patent application.
Besides this synchronous communication model, other models of information exchange between buyer 106 and seller 108 may be supported. For example, asynchronous e-mail exchange may be supported by the system.
Typically, the seller uses a standard HTTP web server (e.g., Apache) to serve HTML pages and runs an application server to provide specific business functionality to buyers (e.g., a shopping system). Integrated with this application are other software components that facilitate access to system services including the validation and warranty services described, for example, in U.S. patent application Ser. No. 09/657,605, filed on Sep. 8, 2000, entitled System and Method for Providing Certificate Validation and Other Services, which is hereby incorporated by reference in its entirety into the present patent application, and the payment services described herein. In a preferred embodiment, this integration may be the active integration described in U.S. patent application Ser. No. 09/657,604, filed on Sep. 8, 2000, entitled System and Method for Facilitating Access By Sellers to Certificate-Related and Other Services, which is hereby incorporated by reference in its entirety into the present patent application. A seller 108's decision about payment instruments to offer buyer 106 and the resulting terms of a purchase are an integral part of the seller's application.
As an example, seller 108's application may use the buyer 106's certificate to identify a customer and apply special terms and conditions to that customer. In addition, the use of the payment services might be dependent on the merchandise as well as a customer's history with seller 108. For example for an order above a specific limit seller 108 may only be willing to accept certified payment obligations provided by a bank. In contrast, below a certain threshold seller 108 may decide to accept payment orders. In addition, a seller may use third party services like a Dun and Bradstreet rating service to decide which payment instruments are acceptable for a given transaction.
Applications running at seller 108 are preferably adapted to sign messages, verify signatures on messages, and check the status of a certificate as described, for example, in U.S. patent application Ser. No. 09/657,604, filed on Sep. 8, 2000, entitled System and Method for Facilitating Access By Sellers to Certificate-Related and Other Services, which is incorporated herein by reference in its entirety into the present patent application, and to provide the payment services described herein.
In addition to Web based implementations, server-to-server communication or an automated email-processing tool may also be employed at the seller's side.
Each participant in the present system may act as either a relying participant or an issuing participant depending on the situation. Thus, for example, in a case where a customer of a first participant is the buyer in a given transaction and a customer of a second participant is a seller in the same transaction, then the first participant is the issuing participant with respect to that transaction, and the second participant is the relying participant with respect to that transaction. Each participant preferably offers a number of services, including the following: acting as a certification authority for its customers (supporting issuance, renewal and revocation of certificates), providing validation and warranty services to its customers, responding to OCSP requests from other system participants (supporting certificate validation), and providing and supporting payment services for its customers (e.g., the payment services discussed herein).
In a preferred embodiment, transaction coordinator 202 is the primary interface to certificate based services provided by a participant. As described in U.S. patent application Ser. No. 09/657,605, filed on Sep. 8, 2000, entitled System and Method for Providing Certificate Validation and Other Services, which is incorporated herein by reference in its entirety into the present patent application, transaction coordinator 202 facilitates system functions like message verification, logging, billing, and authorization to all certificate based services.
Each customer certificate is preferably linked to an end-user authorization system at issuing participant 102 and relying participant 104. The components of the authorization system may be determined by each participant, but typically include information on transaction types, amount limits, overrides and approvals permitted to each customer certificate. A preferred authorization approach is described in U.S. provisional patent application Ser. No. 60/231,313, filed on Sep. 8, 2000, entitled Authorization/Credential Service and Authorization/Credential Service Proposal, which is incorporated herein by reference in its entirety into the present patent application.
Each customer certificate is preferably linked to a payment template system at buyer's bank 102 and seller's bank 104. The payment template stores default payment instructions for buyer 106, seller 108, and seller's bank 104 that are used by buyer's bank 102 to execute payment authorization messages. The design of the payment authorization message may permit some of the instructions to be overridden by a duly authorized buyer or seller end-user.
In a preferred embodiment, each bank may, at its discretion, provide its customers with additional functionality. This additional functionality may include maintenance of limits for a buying company or provision of aggregated management information about the use of payment services by a specific customer.
In a preferred embodiment, the payment services disclosed herein use existing bank networks for actual payment. They may also use existing functionality already available at banks like a payment warehousing system for future dated payments. Some of the connections to these existing systems are preferably real-time and on-line. These systems may include: a real-time, on-line interface to a payment initiation system to create, warehouse, and release payment orders; a real-time, on-line interface to a payment risk system that monitors daylight and overnight limits; a real-time, on-line component for generating payment initiation acknowledgments; a real-time, on-line interface to system identity servers to process digital signatures and identity assurance; a real-time, on-line interface to an application authorization system; and a real-time, on-line interface to a warehouse of payment order cancellation requests sent by a buyer 106 before buyer's bank 102 receives a payment order (payment revocation list).
Payment Instruments and Scenarios
Payment instruments provided by the present system include a payment order, a payment obligation, a certified payment obligation, and conditional payments. A brief description of each payment instrument is now provided. Each payment instrument is described in more detail below.
Payment Order
A payment order (POr) is a revocable, unconditional electronic instruction from a buyer 106 requesting buyer's bank 102 to initiate a credit payment to seller 108 on a specific date for a specified amount. The payment order is typically used when the buyer and seller have an established business relationship.
Payment Obligation and Certified Payment Obligation
A payment obligation (POb) is an irrevocable, unconditional undertaking of a buyer 106 to pay a seller 108, or holder, of the obligation on a specific date for a specified amount at buyer's bank 102. It is evidence of debt of the buyer to the seller. Buyer 106 may request buyer's bank 102 to accept or certify the obligation to pay seller 108, in which case it becomes a certified payment obligation (Certified POb).
A payment obligation is typically used when seller 108 is unsure of buyer 106's intent to pay on time. A certified payment obligation is used when seller is unsure of buyer's ability to pay.
Conditional Payments
A conditional payment is a payment order or a payment obligation in favor of a named seller, payable at buyer's bank 102 upon presentation to buyer's bank 102 of specified electronic messages, signed by specified parties, to evidence fulfillment of pre-agreed conditions. Buyer 106 may request buyer's bank 102 to accept or certify the obligation to pay seller 108, in which case it becomes a certified conditional payment obligation (Certified CPOb).
A conditional payment is used when either buyer 106 or seller 108, or both, agree that the payment will be effected only after certain provisions have been met. It is used to trigger the timing and occurrence of payment. A certified conditional payment obligation adds assurance that the payment will be effected once specified provisions have been met.
Payment Scenarios and Models
In a preferred embodiment, buyer 106, through various commercial and financial scenarios, can initiate payment orders and payment obligations. This is due to the ability of system 200 of
Online Payment Initiation Through Seller Payment Server
In a first payment scenario, seller 108's payment server offers payment order or payment obligation options to buyer 106. As shown in
Online Debit Authorization Through Seller Payment Server
In a second payment scenario, seller 108's payment server offers a direct debit option to buyer 106 as depicted in
Payment Initiation Through Buyer Payment Server
In a third payment scenario, buyer 106's payment server sends a payment order or obligation instructions directly to buyer's bank 102 as depicted in
Legal Relationships Between System Entities
In a preferred embodiment, contractual agreements bind banks and their customers. In particular, the use of system services is preferably defined by a set of operating rules and one or more contracts derived from these rules that are binding on system entities, as described in more detail below.
In a preferred embodiment, operating procedures and rules for the payment services disclosed herein define the rights and responsibilities of the participants. The rules of various electronic payment associations (including those of foreign jurisdictions) may serve as a helpful guide when creating these rules. Moreover, those association rules might even impose certain requirements on the new rules. For example, special attention is preferably given to association rules regarding issues of reversal of transaction and finality of payment.
Alternatively, to the extent that the payment order or obligation cannot be reconciled with existing payment rules, or in the event that such rules need to be supplemented (outside their existing framework) to take account of the unique nature of on-line payment initiation, the various parties involved in a transaction may be bound by an additional set of rules imposed by root entity 110.
In a preferred embodiment, the operating rules for the present system incorporate the Uniform Rules for Electronic Trade and Settlement (URETS), once approved by the International Chamber of Commerce (ICC).
In a preferred embodiment, payment obligations and certified payment obligations in the present system are created and recorded entirely in book entry form. As in the case of the bill of exchange, the payment obligation or the certified payment obligation may preferably be sold in the secondary market. Change in the holder of these obligations may preferably be performed through use of a holder registry service. Buyer's bank 102 is preferably made accountable for registering the correct holder of the obligation.
In a preferred embodiment, before payment services are used, buyer 106 and seller 108 each establish a relationship with their respective participants 102, 104. In a preferred embodiment, this includes the following steps:
In a preferred embodiment, dispute resolution between system entities may be regulated by the operating rules, as described in U.S. patent application Ser. No. 09/502,450, filed Feb. 11, 2000, entitled System and Method for Providing Certification-Related and other Services, which is hereby incorporated by reference.
General Description of Payment Services Products
In a preferred embodiment, the combination of payment obligation, or revocability, and documentary conditions in the present system produce several instrument types that provide a range of payment instruments to meet the credit and risk management needs of business-to-business electronic commerce. These instrument types are summarized in the table below.
In a preferred embodiment, a payment order provides automated, on-line payment initiation to buyers and sellers conducting electronic commerce over the World Wide Web. The payment order can be credit or debit. Debit can be originated by buyer 106 (thus serving as an authorization by the buyer), or it can be a collection (originated by seller 108, without authorization by the buyer; N.B. this may not be permitted in all countries).
Credit-enhanced payment services, where buyer's bank 102 is obligated to pay seller 108, may include a certified payment obligation. The certified payment obligation is preferably an unconditional undertaking of buyer's bank 102 to pay seller 108 for goods purchased.
In a preferred embodiment, a conditional payment order is similar to the payment order described above except that buyer's bank 102 does not release payment until it has received documents from seller 108 evidencing that seller 108 has shipped the goods that are the subject of the transaction. A certified conditional payment obligation is preferably an undertaking of buyer's bank 102 to pay seller 108, conditioned on seller 108 or a third party submitting documents specified in the documentary credit to buyer's bank 102 to evidence fulfillment of contractual obligations.
The present system and method employ a plurality of request messages and response messages to implement the above-identified payment instruments. Generally, these include:
It should be noted that the categorization of the above messages is general, and that a more specific categorization and functional description of these and other related messages may vary depending on how the system of the present invention is specifically implemented. A preferred implementation of system messages using Extensible Markup Language (XML) is described in detail below.
In a preferred embodiment, each message is structured to support signed additions to its contents and attachments (including one or more signatures/certificates to each addition) while preserving non-repudiation for each signing party and the final recipient. In addition, in a preferred embodiment, the system adheres to the following requirements:
1. Each request message, when received by the intended final party, returns a service acknowledgment (Srv Ack) message.
2. When a financial institution executes a payment, it sends a confirmation (Pay Conf) message of this action to the appropriate parties.
3. When a financial institution receives a payment obligation instruction, it sends a confirmation message (POb Acpt Conf) to the sender of the message indicating whether the obligation will or will not be carried out. A CePOb Acpt Conf message is preferably sent in response to payment obligation messages that are requested to be certified.
4. When a financial institution receives a payment order cancellation message (POr Cncl), it responds with a message (POr Cncl Conf) confirming that this cancellation has been accepted or rejected.
5. When a third party service provider (TPSP) entity receives a condition advice message (Cnd Adv), it responds with a response message (Cnd Decl), when the condition has been met, or when it ascertains that the condition will never be met.
6. Payment instruction messages may be signed by multiple parties at buyer 106's organization.
7. All payment messages are signed by each relaying party.
8. Buyers 106 and sellers 108 use a bank's certificate to identify themselves in a payment message (except in the circumstance where the buyer and seller have the same bank, i.e., in the case of a three, rather than four, corner transaction).
Tables describing the content of each system message are provided below. In each table, the first column identifies the name of the message portion, the second column specifies whether, in a preferred embodiment, the message portion is mandatory, optional, or conditional (i.e., whether it is mandatory depends on the circumstances), the third column identifies the entity that provides the content for the message portion, and the fourth column contains additional comments concerning the message portion.
In a preferred embodiment, a payment order instruction comprises the following data:
In a preferred embodiment, a payment obligation instruction contains the data listed above for a payment order instruction with the exception of the changes listed in the table below:
In a preferred embodiment, a certified payment obligation instruction contains the same data as that listed above for a payment order instruction.
In a preferred embodiment, (1) a conditional payment order instruction contains the data described above for a payment order instruction with the exception of the changes listed in the table below; (2) a conditional payment obligation instruction contains the data described above for a payment obligation instruction with the exception of the changes listed in the table below; and (3) a certified conditional payment obligation instruction contains the data described above for a certified payment obligation instruction with the exception of the changes listed in the table below:
In a preferred embodiment, payment conditions are selected from a collection of condition templates. In addition, each condition is preferably structured to allow an unambiguous true/false confirmation.
In a preferred embodiment, the TPSP may attach or append to the confirming message additional purchase details or electronic documents/files for information purposes which may or may not be required under the condition.
In a preferred embodiment, payment order cancellation messages (POr Cncl) may be signed by multiple parties at buyer 106's organization.
In a preferred embodiment, payment order cancellation messages contain the following data:
In a preferred embodiment, condition advice (Cnd Adv) messages are sent from a trusted service supplier (TSS) organization, a role which may be played by buyer's bank 102. These messages are used to set conditions which must be met in order to facilitate payment execution. In a preferred embodiment, all condition advice messages (Cnd Adv) are sent to the TPSP and the TPSP sends a service acknowledgment (Srv Ack) message in response to this message. In a preferred embodiment, the condition advice message contains the following data:
In a preferred embodiment, parties obtain information relating to specific transactions from other parties in the payment initiation system using status enquiry messages.
In a preferred embodiment, a response message is produced on receipt of any type of request message. Each response message preferably indicates whether it is returning a positive or negative response to the received request message.
In a preferred embodiment, service acknowledgment (Srv Ack) messages are sent in response to all request messages. The following messages are all preferably responded to with service acknowledgment (Srv Ack) messages:
In a preferred embodiment, service acknowledgment (Srv Ack) messages are sent when the syntax, signature(s), certificate(s), and user authority contained within the message are verified by the final intended recipient. This final intended recipient may vary as a function of the payment scenario. For example, in the four-corner model, the intended final recipient of payment order/obligation request messages, is buyer's bank 102. In contrast, in the direct debit model, the intended final recipient of payment order/obligation request messages, is seller's bank 104. In a preferred embodiment, service acknowledgment (Srv Ack) messages are sent in response to any received payment instruction message within one minute from receipt by the final intended recipient of the payment instruction message.
In a preferred embodiment, the service acknowledgment (Srv Ack) message contains the data listed in the following table:
In a preferred embodiment, whenever an entity that is not the final intended recipient receives a service acknowledgment (Srv Ack) message the entity envelopes this information, adds its service acknowledgment (Srv Ack) information, and passes the message onto the final intended recipient. For example, when a seller's bank 104 receives a service acknowledgment (Srv Ack) from a buyer's bank 102 when operating in the four-corner model, it passes this service acknowledgment (Srv Ack) onto its seller 108.
In a preferred embodiment, this service acknowledgment (Srv Ack) message contains the data listed in the previous table, as well as the data listed in the following table:
In a preferred embodiment, payment execution confirmation (Pay Conf) messages are sent when a financial institution has executed the payment process specified in the related payment instruction. The payment execution confirmation (Pay Conf) message is preferably sent to the appropriate recipients no later than by the end of the following business day. This payment execution confirmation (Pay Conf) message preferably contains the following data:
In a preferred embodiment, when an entity receives a payment execution confirmation (Pay Conf) message, the entity envelopes this information, adds its payment execution confirmation (Pay Conf) information, and passes the message onto the final intended recipient. For example, when a seller's bank 104 receives a payment execution confirmation (Pay Conf) from buyer's bank 102 when operating in the four-corner model, it passes this payment execution confirmation (Pay Conf) message onto seller 108.
In a preferred embodiment, this payment execution confirmation (Pay Conf) message contains the data listed in the above table as well as the following data:
In a preferred embodiment, payment obligation acceptance confirmation (POb Acpt Conf) messages are sent in response to a payment obligation request message by the close of the following working day. The payment obligation acceptance confirmation (POb Acpt Conf) message preferably contains the data listed below:
In a preferred embodiment, when an entity that is not the final intended recipient receives a payment obligation acceptance confirmation (POb Acpt Conf) message, the entity envelopes this information, adds its payment obligation acceptance confirmation (POb Acpt Conf) information, and passes the message onto the final intended recipient. For example, when a seller's bank 104 receives a payment obligation acceptance confirmation (POb Acpt Conf) from buyer's bank 102 when operating in the four-corner model, it passes this payment obligation acceptance confirmation (POb Acpt Conf) to its seller 108. This payment obligation acceptance confirmation (POb Acpt Conf) message preferably contains the data listed in the above table as well as the following data:
In a preferred embodiment, certified payment obligation acceptance confirmation (CePOb Acpt Conf) messages are sent in response to a certified payment obligation request message by the close of the following working day. The certified payment obligation acceptance confirmation (CePOb Acpt Conf) message preferably contains the data in Table 13.
In a preferred embodiment, payment order cancellation confirmation (POr Cncl Conf) messages are sent in response to a payment order cancellation instruction message (POr Cncl Inst), by the close of the following working day. The payment order cancellation confirmation (POr Cncl Conf) message preferably contains the following data:
In a preferred embodiment, condition update (Cnd Update) messages may be sent in conjunction with condition advice messages. These messages are preferably sent from TPSP parties to provide updates on the progress that has been made in meeting the condition specified by the condition advice message.
In a preferred embodiment, condition declaration (Cnd Decl) messages are sent in response to a condition advice message by TPSP parties. Condition declaration (Cnd Decl) messages are preferably sent when either a condition outlined by an original condition advice (Cnd Adv) message has been met, or if the condition will never be met. For example, if a condition is that some goods will be shipped by a specific date, and the goods have yet to be shipped, and that specified date has passed, a negative response is sent.
The condition declaration (Cnd Decl) message preferably contains the following data:
In a preferred embodiment, a status inquiry response message (Sts Inq Resp) contains a history of the transaction specified in the status inquiry request.
Communication Protocols
In a preferred embodiment, the following protocols and formats are used in signing and formatting signed data:
More particularly, the following rules preferably set out the formats for exchanges and signatures between payment parties in a transaction using the system and method of the present invention:
In a preferred embodiment, system messages are structured using Extensible Markup Language (XML) with corresponding date type definitions whenever appropriate, in order not to restrict technical implementation and integration options. A preferred implementation of several data type definitions (DTDs) is described below.
The system requires that all payment specific messages be uniquely distinguishable as payment messages and also that message identifiers (tags) are non-ambiguously defined. With XML documents, the system of the present invention preferably meets these requirements by using XML Namespaces. XML namespaces provide a simple means for qualifying element and attribute names used in XML documents by associating them with namespaces identified by URI (Uniform Resource Identifier) references. Each payment top level XML document specifies the XML namespace in which the data elements occur. The XML document may, for example, reference the namespace as described in Table 17 as follows:
Payment Request DTD
The contents of the PaymentRequest DTD (Document Type Definition) in a preferred embodiment are given in Table 18 below (the PaymentRequest DTD may also import certain DTDs such as a ConditionSet and a CertificateStatusCheck, described below):
The system specifies a “Msggrpid” and a “MsgID” attribute in the NIB (Network Information Block) and requires that the value of this is specified to be unique for each message in the transaction. The Msggrpid is a unique ID that is common to all documents in any single exchange. Note that a number of exchanges may concern a single payment transaction. Each exchange (for instance the Payment Request—Service Acknowledgement exchange, or the Cancellation Request—Service Acknowledgement exchange) will have the same Msggrpid. Asynchronous communications are to be treated as atomic exchanges. The Msgid is used as a sequential counter for each document in an exchange. However, as exchanges may become complex, to ensure that the Msggrpid:Msgid combination can uniquely identify a document within an exchange, the role of the sender is preferably used in conjunction with a sequence number.
A preferred structure of the Msgid is: “xx:nn”, where xx are the role identifiers and nn the sequence number for documents sent by that role in the current exchange. To enable a transaction coordinator to identify a system payment message, the HTTP content type should be specified appropriately.
The SystemPayRequest document may be used to specify the payment instruction messages described above and listed in Table 2, i.e. POr Inst, POb Inst, CPOr Inst, CPOb Inst, CePOB Inst, and CeCPOb Inst. The SystemPayRequest DTD in a preferred embodiment is described in Table 19 below:
The SystemHeader provides a unique transaction reference for all transactions, and with the Product attribute allows a specific payment product instruction message to be specified. The header is a component common to all messages and includes, in a preferred embodiment, the following attributes (Table 20):
In a preferred embodiment, the following validation rules in Table 21 apply to the SystemHeader attributes:
The BuyerSignedData DTD of the SystemPayRequest DTD includes in a preferred embodiment the following data blocks (Table 22):
The NegotiatedData block carries data elements negotiated during the transaction and preferably has the following attributes (Table 23):
The following validation rules in Table 24 preferably apply to the NegotiatedData attributes:
The BuyerData block (in the BuyerSignedData DTD) contains information provided by buyer 106 in the transaction and carries data elements negotiated during the transaction. The BuyerData block preferably contains contact data (e.g., in a contact sub-block) that provides details for any issues with the transaction. The BuyerData block has the following attributes in a preferred embodiment (Table 25):
The following validation rules in Table 26 preferably apply to the BuyerData attributes:
The SellerPublicData block (in the BuyerSignedData DTD) contains information provided by the seller 108 in the transaction and preferably contains contact details for any issues that arise with respect to the transaction. The SellerPublicData block, in a preferred embodiment, has the following attributes, listed in Table 27:
The following validation rules in Table 28 preferably apply to the SellerPublicData attributes:
The Obligation block (in the BuyerSignedData DTD) contains details of any obligation to be put in place as a result of the transaction. Note that if no obligation is to be undertaken, the block is included with ObligationType set to NONE. The Obligation block has the following attributes in a preferred embodiment (Table 29):
The following validation rules preferably apply to the Obligation block attributes (Table 30):
The ConditionSet block (in the BuyerSignedData DTD) contains a description of the conditions that attach to a payment (this block corresponds to the Cnd Adv request message described above and listed in Table 2). The ConditionSet block is an imported element and used in a number of the Payment blocks in the system, as described elsewhere.
The BuyersSignatureDetails block (in the BuyerSignedData DTD) contains signatures created by actors in the buying organization. Approval cycles may require a number of signatures to be provided against any given instruction, as described in more detail below. The BuyersSignatureDetails block can contain one or more BuyerSignatureDetail blocks. A BuyerSignatureDetail block contains the information about a signature created by buyer 106, preferably as in Table 31 as follows:
The following validation rules preferably apply to the BuyersSignatureDetails attributes (Table 32):
The SystemPayRequest DTD also includes a BuyersSignatures block that contains the signatures created by actors in the buying organization. Approval cycles may require a number of signatures to be provided against any given instruction. In a preferred embodiment, the BuyersSignatures block includes the following block in Table 33:
The following validation rules, in Table 34, preferably apply to the BuyersSignature block:
The BuyersSignature block also preferably contains the following attribute in Table 35:
The validation rules in Table 36 apply to the Sequence attribute in a preferred embodiment:
The SellerPrivateData block of the SystemPayRequest DTD contains private data that is passed from seller 108 to seller's bank 104. The SellerPrivateData block is removed by seller's bank 104 and not included in the datablocks passed to buyer's bank 102. It contains the following attributes in a preferred embodiment (Table 37):
The following validation rules in Table 38 preferably apply to the SellerPrivateData attributes:
The SellerBankData block of the SystemPayRequest DTD carries information from seller's bank 104 to buyers bank 102 in the transaction. Seller's bank 104 can provide relevant contact details in the contact block (described below) if required. In a preferred embodiment, the SellerBankData block contains the attributes in Table 39:
The following validation rules preferably apply to the SellerBankData attributes (Table 40):
Payment Response
The contents of the PaymentResponse DTD, in a preferred embodiment, are given in Table 41 below (the PaymentResponse DTD may also import certain DTDs such as a CertificateStatusCheck and a Contact element):
The SystemPayResponse DTD, in a preferred embodiment, is described in Table 42 below.
As indicated, the SystemHeader provides a unique transaction reference for all transactions and is a component common to all messages. The attributes of the SystemHeader are given in Table 20 and the associated validation rules in Table 21 in a preferred embodiment.
The References DTD of the SystemPayResponse DTD preferably includes the following attributes (Table 43):
The following validation rules, in Table 44, preferably apply to the References attributes:
The ChallengeAck DTD is returned in response to a ChallengeRequest. The ChallengeRequest is optionally used by institutions to validate the identity of a corresponding institution before passing payment details to that institution. The ChallengeAck is successful if the acknowledging institution (a) can positively authenticate the identity of the sender and (b) supports the product being requested. contact information can be included by the responding financial institution within the ChallengeAck. ChallengeAck, in a preferred embodiment, includes the following attributes (Table 45):
The validation rules in Table 46 preferably apply to the ChallengeAck attributes:
The following reason codes (Table 47) may be used with ChallengeAck:
The ServiceAck DTD (corresponding to the Srv Ack response message in Table 3 above) may include contact information by the responding financial institution within the ServiceAck. It preferably has the following attributes in Table 48:
The following validation rules (Table 49) apply to the ServiceAck attributes:
In a preferred embodiment, the following Reason Codes are used with ServiceAck (Table 50):
The PayInstAck DTD is a positive or negative acknowledgement sent as a result of the validation of transaction information in bank payment systems. PayInstAck preferably contains the NegotiatedData block to confirm the data that is being processed by buyer's bank 102 (seller's bank 104 in the direct debit transaction model) for processing. The NegotiatedData block includes the attributes listed above in Table 23. In the context of SystemPayResponse, the following validation rules, listed in Table 51, preferably apply to the attributes in the NegotiatedData block:
PayInstAck preferably includes the following attributes in Table 52:
The following validation rules preferably apply to the PayInstAck attributes (Table 53):
The Reason Codes in Table 54 are used, in a preferred embodiment, with PayInstAck:
The PayConf DTD is sent by the bank executing the payment to customers and correspondent banks and may be used by both the buyer's bank 102 and seller's bank 104 to inform correspondent banks of: the success or failure in execution of a system payment instruction, failure resulting from processing by the clearing and settlement network, and successful receipt of payment by the beneficiary's bank. The ReasonCode and ReasonText for successful PayConf qualify the successful event. PayConf includes the following attributes in a preferred embodiment (Table 55):
The following validation rules in Table 56 preferably apply to the PayConf attributes:
The following Reason Codes are preferably used with PayConf (Table 57):
The ObligationConf DTD block confirms the success or failure of a request for an obligation. An ObligationConf is only returned when a (Conditional) Payment Obligation or (Conditional) Certified Payment Obligation is requested. This block, depending on the SystemHeader, corresponds to the POb Acpt Conf or the CePOb Acpt Conf response messages listed in Table 3 above. ObligationConf preferably has the following attributes, listed in Table 58:
The following validation rules in Table 59 preferably apply to the ObligationConf attributes:
The following Reason Codes (in Table 60) are also preferably used with ObligationConf:
The CancellationConf DTD block provides negative or positive confirmation of a cancellation request. This block may be used to implement the Por Cncl Conf response message describe above. In a preferred embodiment, CancellationConf has the attributes listed in Table 61:
The following validation rules (Table 62) preferably apply to the CancellationConf attributes:
The following Reason Codes (Table 63) are also preferably used with CancellationConf:
The ConditionSetUpConf DTD block provides negative or positive confirmation of a request to set up conditions against payment. ConditionSetUpConf corresponds to the above described Cnd Update response messages listed in Table 3. The response indicates only that the conditions now exist within the domain of a TSS. All other communications about conditions use the document defined in the PayCondition DTD (described below). ConditionConf preferably includes the following attributes, listed in Table 64:
The following validation rules preferably apply to the ConditionConf attributes included in the element (Table 65):
The following Reason Codes, in Table 66, are preferably used with ConditionConf:
A RelatedAcknowledgement DTD element may optionally be used to support and carry other acknowledgements related to a transaction. For example, it may be used in seller bank 104-to-seller 108 communication to carry the acknowledgement provided by buyer's bank 102 to seller's bank 104. The RelatedAcknowledgement has three standardized attributes that allow for identification, decoding and interpretation of the contents. In a preferred embodiment, those attributes, listed in Table 67, are as follows:
Suitable validation rules may be implemented for the RelatedAcknowledgement attributes, as appropriate.
Payment Condition
The PaymentCondition document is used to pass information about the status of conditions between parties involved in a transaction (the Cnd Decl response message described above and listed in Table 3 corresponds to a PaymentCondition document). Note that the document is only used when conditions have been successfully created in the TSS.
The PaymentCondition document is preferably used:
The contents of the PaymentCondition DTD are preferably given in Table 68 below:
The SystemPayCondition DTD contains, in a preferred embodiment, the following elements or blocks (as indicated in Table 69):
The attributes of the SystemHeader, in a preferred embodiment, for conditional payment products are included in Table 20 above. The preferable associated validation rules are also provided in Table 21 above and, for a conditional payment, also preferably include the validation rule in Table 70 for the Product attribute:
The References block is used to identify the commercial payment transaction to which the conditions are attached. The attributes and associated validation rules for the Reference block in a preferred embodiment are provided above in Tables 43 and 44 respectively.
The ConditionSet block contains a description of the conditions that attach to a payment. The ConditionSet block is an imported element and, as indicated, is used in a number of the system payment blocks. A preferred description of this block is given in more detail below.
As also indicated above, the Contact block contains contact details that may be used to provide contact information for the parties involved in a transaction. The Contact block is preferably an imported element and also used in a number of the system payment blocks that import it (as described above and also including ConditionSet). The Contact data element in a preferred embodiment is also described in more detail below.
Payment Cancellation
The PaymentCancellation document is used to request the cancellation of a payment. The POr Cncl request message described above and listed in Table 2 is implemented in a PaymentCancellation document. Generally, “irrevocable” payments—where a buyer or bank obligation has been undertaken—can only be cancelled with the assent of seller 108. In a preferred embodiment, the contents of the PaymentCancellation DTD are defined in Table 71:
The SystemPayCancellation DTD preferably contains the following blocks, listed in Table 72:
The SystemHeader block is a component common to all messages, as indicated above. Tables 20 and 21 above provide the attributes and validation rules of this block according to a preferred embodiment. In addition, in the context of payment cancellation, for the MessageType, valid values in the request structure are: Cancellation Request and Query.
The CancBuyerSignedData block preferably includes the following elements (Table 73):
The References block contains references to the transaction that is being requested to be cancelled. The attributes and associated validation rules for the Reference block in a preferred embodiment are provided above in Tables 43 and 44 respectively. The CancellationData block contains additional data provided by buyer 106 and relayed to buyer's bank 102 regarding the cancellation. Preferably, this block has attributes and associated validation rules for carrying out cancellation instructions.
The BuyersSignatures block (in the CancBuyerSignedData block) contains signatures created by actors in the buying organization authorizing the cancellation of the transaction. Approval cycles may require a number of signatures to be provided against any given instruction. The BuyersSignatureDetails block can contain one or more BuyerSignatureDetail blocks. A BuyerSignatureDetail block contains the information about a signature created by buyer 106, and, in a preferred embodiment, its attributes are given in Table 31 and associated validation rules in Table 32. As also indicated above, a related BuyersSignature block (included in the SystemPayCancellation DTD) preferably contains a PCDATA block in which the signature is included in the BuyerSignature element as PCDATA (see Table 33). The attribute and associated validation rules for that block are given in Tables 34-36 for a preferred embodiment.
Payment Challenge
A Payment Challenge document allows a financial institution that requires proof of identity of a third party financial institution prior to exchanging application data to establish the identity of that institution and confirm that the payment product is supported. The response to a PaymentChallenge is a PayResponse with a ChallengeAck included. The PaymentChallenge DTD has the following elements in a preferred embodiment (Table 74):
Condition Set
The ConditionsSet element DTD is used in a number of transactions to carry information about the conditions which can attach to payments. The ConditionSet DTD preferably contains the following elements, listed in Table 75:
ConditionSet preferably has the following attributes, listed in Table 76:
Suitable validation rules may be applied to the ConditionSet attributes.
The Condition block may contain a Contact block. If conditions within a payment are to be discharged by different TPSPs, then contact information is preferably appended against each condition rather than against the ConditionSet. Preferably, this element is only present when buyer 106 or seller 108 informs a financial institution of the conditions in the PayRequest document. The Condition block has the following attributes in a preferred embodiment (Table 77):
The following validation rules, listed in Table 78, preferably apply to the Condition block attributes:
The system may define conditions to be used with the payment products.
Another element that may be used in connection with payment conditions is PackagedContent. The PackagedContent element supports the concept of an embedded data stream, transformed to both protect it against misinterpretation by transporting systems and to ensure XML compatibility. It may be used within the system to allow the TPSP to provide supporting documentation when discharging conditions. The documentation, carried as PCData, is preferably forwarded to the seller once all conditions have been discharged. The PackagedContent data stream preferably has three standardized attributes that allow for identification, decoding and interpretation of the contents, and these attributes are preferably defined as follows in Table 79 below:
Again, suitable validation rules may be applied to the PackagedContent attributes.
Contact
The Contact DTD is used in a number of document definitions and so is preferably defined in a separate DTD for re-use. The structure contains generic contact data, connected with the element that it is being used in conjunction with. Generally, this data contains the names and contact details of one or more individuals dealing with any given transaction. Thus, the Contact block may have the following attributes (the descriptions of which are self-explanatory in Table 80):
Suitable validation rules may be applied to the Contact attributes, as appropriate. The ContactData block may also include the following attributes (again, for these attributes, the descriptions in Table 81 are self-explanatory):
Validation rules are also applied to these attributes, as appropriate.
Field Lengths and Formats
Table 82 summarizes the field lengths and formats for many of the payment system data fields in a preferred embodiment:
Error Codes and Error Texts
Reason Codes may be used within the payment system to provide more detail as to the reason for success or failure of any particular event. A preferred structure of the reason code is ssbbnn, where
ss=the identifier of the scheme who owns the error code (e.g. 00),
bb=indicates the DTD block within the scheme, and
nn=number of the error.
The following bb block codes in Table 83 may, for example, be used with respect to the DTDs given above:
Table 84 below also summarizes a set of preferred Reason Codes.
Preferred general message flows for particular payment processes, and typical transaction steps exemplifying those message flows in different transaction models, are now described in connection with
Payment Order Message Flow
A preferred general message flow for processing a payment order is shown in
Buyer 106 then reviews the payment order for acceptability, completes the buyer's section in the payment order instruction (see Table 4 above), and signs the payment order instruction. Then, as shown in message 1 of
Seller 108 reviews the received payment order instruction for acceptability, completes the seller's section of the payment order instruction (see Table 4 above), and signs the amended payment order instruction. Then, as shown in message 2 of
Seller's bank 104 reviews the payment order instruction for acceptability, verifies the seller's certificate, completes its section of the order (see Table 4 above), and signs the amended payment order instruction. Then, as shown in message 3 of
Buyer's bank 102 reviews the payment order instruction for acceptability and verifies the message syntax, the validity of the certificate and signature, and the authority of the signer. Buyer's bank 102 then creates a service acknowledgment message (see Table 9 above) with the results of these checks, and signs and sends the service acknowledgment to seller's bank 104 as shown in message 4 of
Seller's bank 104 reviews the service acknowledgment, amends it with its details if necessary, and signs the amended message. The message is then sent to seller 108, as shown in message 5 of
Seller 108 reviews the service acknowledgment, amends it with its details if necessary, and signs it. The amended service acknowledgment is then sent to buyer 106 as shown in message 6 of
When the payment execution date/time specified in the payment order instruction is reached, the payment order instruction is executed, preferably utilizing the banks' existing payment infrastructure.
Buyer's bank 102 creates a confirmation of a payment execution (see Table 11 above) to signify that the payment order has been executed. Buyer's bank 102 then signs and sends this message to seller's bank 104 as shown in message 7 of
Seller's bank 104 reviews the confirmation of a payment execution, amends the confirmation of a payment execution with its details if necessary, signs the amended message, and sends it to seller 108 as shown in message 8 of
Buyer's bank 102 creates a confirmation of a payment execution to indicate whether this payment order has been executed successfully or not. Buyer's bank 102 then signs this message and sends it to the buyer as shown in message 9 of
In a preferred embodiment, if buyer's bank 102 has not yet sent a confirmation of a payment execution message stating that the payment order has been executed and passed into the bank's payment infrastructure, then buyer 106 has the ability to cancel the payment order. To cancel a payment order, buyer 106 creates a payment order cancellation (see Table 7 above). The buyer signs the payment order cancellation and sends it to buyer's bank 102 as shown in message 10 of
In a preferred embodiment, because revocation of a payment request by buyer 106 is permitted, the payment service preferably stores revocation requests even if a corresponding payment request has not been obtained. This permits a delayed payment request, which already has been revoked, to be identified and prevented from execution.
Buyer's bank 102 reviews the payment order cancellation for acceptability and verifies the message syntax, the validity of the certificate and signature, and the authority of the signer. Buyer's bank 102 then creates a service acknowledgment message (see Table 9 above) with the results of these checks. Buyer's bank 102 then signs and sends the service acknowledgment to buyer 106 as shown in message 11 of
Buyer's bank 102 creates a confirmation of a payment order cancellation (see Table 15 above) to signify that the payment order cancellation request has been accepted. Buyer's bank 102 then signs and sends the confirmation of a payment order cancellation to buyer 106 as shown in message 12 of
Buyer's bank 102 creates a confirmation of a payment order cancellation to signify that the payment order cancellation request has been accepted. Buyer's bank 102 signs and sends the confirmation of a payment order cancellation to seller's bank 104 as shown in message 13 of
The payment order may be presented in the three models described above: in the four corner model; as an instruction from the buyer to a buyer's bank; or as a direct debit style instruction that is placed by the seller's bank into the clearing and settlement system.
Payment Order Transaction in the Four Corner Model
A typical payment order transaction in the four corner model occurs as follows.
For revocable payment orders, the payment can be cancelled using a four corner model. Buyer's bank 102 should inform buyer 106 asynchronously as to the success of the cancellation request. A typical cancellation of a payment order in this type of transaction occurs as follows.
Buyer to buyer's bank transactions ensure that the payment products can be delivered in procurement and other buyer technologies. A typical buyer to buyer bank transaction for a payment order occurs as follows.
For revocable payment orders, the payment can be cancelled using the buyer to buyer's bank model. The following describes a typical payment order cancellation through this model.
Use of the direct debit model in the present invention allows payment products to be used in conjunction with clearing and settlement networks that allow direct debit style payments. This type of transaction may be used in accordance with the rules of individual clearing houses. A typical payment order transaction using the direct debit model occurs as follows.
Depending on the rules of the Direct Debit network and/or policy of member banks, Direct Debit instructions may also be cancelled in a two party (buyer to buyer's bank and seller to seller's bank) or four party model. The following describes a typical cancellation in the four party model.
A preferred general message flow for processing a payment obligation is shown in
Buyer 106 accepts the payment method, reviews the payment obligation instruction for acceptability, completes the buyer section of the payment obligation instruction, and then signs the payment obligation instruction. The payment obligation instruction is then sent to seller 108 as shown in message 1 of
Seller 108 reviews the payment obligation instruction for acceptability, completes its section of the order (see Tables 4 and 5 above), signs the amended message, and sends it to seller's bank 104 as shown in message 2 of
Seller's bank 104 reviews the payment obligation instruction for acceptability, verifies seller's certificate, completes its section of the order (see Tables 4 and 5 above), and signs the amended message. The message is then sent to buyer's bank 102 as shown in message 3 of
Buyer's bank 102 reviews the payment obligation instruction for acceptability and verifies the message syntax, the validity of certificate and signature, and the authority of the signer. Buyer's bank 102 then creates a service acknowledgment message (see Table 9 above) with the results of these checks. Buyer's bank 102 then signs and sends the service acknowledgment to seller's bank 104 as shown in message 4 of
Seller's bank 104 reviews the service acknowledgment, amends it with its details if necessary, and signs the amended message. The amended service acknowledgment message is then sent to seller 108 as shown in message 5 of
Seller reviews the service acknowledgment, amends it with details if necessary, and signs the amended message. The amended service acknowledgment is then sent to buyer 106 as shown in message 6 of
Buyer's bank 102 creates a payment obligation acceptance confirmation message (see Table 13 above) to signify whether the payment obligation has been accepted. Buyer's bank 102 then signs the payment obligation acceptance confirmation and sends it to seller's bank 104 as shown in message 7 of
Seller's bank 104 reviews the payment obligation acceptance confirmation, amends with its details if necessary, signs the amended message, and sends it to seller 108 as shown in message 8 of
Buyer's bank 102 reviews the confirmation of a payment execution, amends it with its details if necessary, signs the amended message, and sends it to seller 108 as shown in message 9 of
When the date and time specified in the payment obligation instruction has been reached, the payment obligation is executed, preferably utilizing the bank's existing payment infrastructure.
Buyer's bank 102 creates confirmation of a payment execution (see
Seller's bank 104 reviews the confirmation of a payment execution, amends the confirmation of a payment execution information with its details, signs the amended message, and sends it to seller 108 as shown in message 111 of
Buyer's bank 102 creates a confirmation of a payment execution message to signify that the payment order has been executed. Buyer's bank 102 then signs this message and sends it to buyer 106 as shown in message 12 of
Payment Obligation Transaction in the Four Corner Model
A payment obligation may be used in either the four corner or buyer to buyer's bank model. A typical payment obligation transaction in the four corner model occurs as follows.
For payment obligations, the payment can be cancelled using the following four corner model process or an out of band process that includes positive assent to the cancellation by seller.
A typical payment obligation transaction in the buyer to buyer's bank model occurs as follows.
Payment obligations generally cannot be cancelled using the buyer to buyer's bank model.
Certified Payment Obligation Message Flow
In a preferred embodiment, the certified payment obligation product may employ the same general message flow as shown in
Certified Payment Obligation Transaction in the Four Corner Model
In the four corner model, a certified payment obligation transaction typically occurs as follows.
For Certified Payment Obligations, the payment can be cancelled using the following four corner model process or an out of band process that includes positive assent to the cancellation by seller.
In the buyer to buyer's bank model, a certified payment obligation transaction typically occurs as follows.
Certified Payment Obligations generally cannot be cancelled using the buyer to buyer's bank model.
Conditional Payments
As indicated, conditions may be attached to all three payment products described above to form three conditional payment products.
Management of Conditions in Conditional Payments
Ground rules may be applied in the present invention to govern the relationship between the creation and management of conditions and obligations. In a preferred embodiment, the following ground rules for the use of conditions with payment instructions apply:
Preferably, the lifecycle of the conditions is determined as follows:
In addition, the following rules preferably govern the processing of conditional obligations in the present invention:
In a preferred embodiment, much of the message flow for the conditional payment order product is the same as for the payment order product described above except that a CPOr Inst is substituted for a POr Inst in message 1 of
The condition details may be supplied to the TSS by buyer's bank 102. In this case, the TSS may inform buyer's bank 102 when a condition has been met so that buyer's bank 102 may respond accordingly. Alternatively, buyer's bank 102 may act as the TSS.
Turning to
The third party service supplier reviews the condition advice for acceptability, verifies the message syntax, the validity of certificate and signature, and authority of the signer. The third party service supplier then creates a service acknowledgment message with the results of these checks. The third party service provider then signs the service acknowledgment and sends it to the trusted service supplier as shown in message 2 of
The third party service provider creates a condition update message to inform the trusted service supplier of a completed step in the condition fulfillment process. The third party service provider signs the message and sends it to the trusted service supplier as shown in message 3 of
The trusted service supplier reviews the condition update message for acceptability, verifies the message syntax, the validity of the certificate and the signature, and the authority of the signer. The trusted service supplier then creates a service acknowledgment (see Table 9 above) with the results of these checks. The trusted service supplier then signs and sends the service acknowledgment to the third party service supplier as shown in message 4 of
The third party service provider creates a condition declaration message (see Table 16 above) in order to inform the trusted service supplier of a fulfillment of the condition process. This message may be either positive or negative. The third party service provider signs the message and sends it to the trusted service supplier as shown in message 5 of
The trusted service supplier reviews the conditional declaration message for acceptability, and verifies the message syntax, the validity of the certificate and signature, and the authority of the signer. The trusted service supplier then creates a service acknowledgment message (see Table 9 above) with the results of these checks. The trusted service supplier signs the service acknowledgment and sends it to the third party service provider as shown in message 6 of
Conditional Payment Obligation Message Flow
In a preferred embodiment, much of the message flow for the conditional payment obligation product is the same as for the payment obligation described above except that a CPOb Inst is substituted for a POb Inst in message 1 of
Certified Conditional Payment Obligation Message Flow
In a preferred embodiment, the certified conditional payment obligation product may employ the same message flow outlined in connection with the conditional payment obligation above (with the additional condition process included), except that a CePOb Inst message is substituted for CPOb Inst and a CePOb Acpt Conf message is substituted for CPOb Acpt Conf.
As described in detail above, message formats preferably adhere to open standards to ensure compatibility across national boundaries due to the global nature of the payments system. For example, the use of multi-byte character sets in order to accommodate different languages is preferred.
Also preferably, payment transactions are date and time stamped by each of the parties involved in the payment system. In a preferred embodiment, time stamps are based on Universal Time Code (U.T.C.) format, and produced by a third party trusted time server.
In a preferred embodiment, all payment related messages are secured through the use of certificates issued from trusted certification authorities. In a preferred embodiment, these certificates are used to digitally sign messages, providing message authentication, integrity, and non-repudiation.
In a preferred embodiment, the confidentiality of all information exchanged between parties in the payments system is maintained and that information is protected from unauthorized access. Encryption of at least 128-bit strength is preferably employed, using SSLv3/TLS.
In a preferred embodiment, the present payments system provides comprehensive error handling which preferably covers the following areas: message related errors including but not limited to message syntax, message signature verification/authentication, message data such as incorrect bank identification codes, and payment authorization; message specific errors including but not limited to failing to meet set conditions; and payment systems infrastructure errors including but not limited to transmission problems and time-out problems.
In a preferred embodiment, all payment initiation messages are idempotent. For example, when a payment order instruction is sent and no service acknowledgment is received within a specified time limit, the payment order instruction may be sent again, without the intended recipient of this message acting upon this request message twice.
Also, while the system of the present invention preferably includes the automatic processing of acknowledgements as described, participants may also choose to provide acknowledgements through many channels, such as: traditional cash management systems; web-based banking services; voice, fax and other telephony services; or SMS, WAP and other mobile services.
While the invention has been described in connection with specific embodiments, it is evident that numerous alternatives, modifications, and variations will be apparent to those skilled in the art in light of the foregoing description.
This application is a continuation of, claims priority from, and incorporates by reference in its entirety U.S. patent application Ser. No. 09/657,622 filed Sep. 8, 2000(now abandoned); and said application Ser. No. 09/657,622 claims priority from U.S. provisional patent application 60/155,841, filed Sep. 24, 1999, entitled System and Process for Payment Services, which provisional application is also hereby incorporated by reference in its entirety into the present patent application.
| Number | Name | Date | Kind |
|---|---|---|---|
| 4304990 | Atalla | Dec 1981 | A |
| 5048085 | Abraham et al. | Sep 1991 | A |
| 5191193 | LeRoux | Mar 1993 | A |
| 5353350 | Unsworth et al. | Oct 1994 | A |
| 5389738 | Piosenka et al. | Feb 1995 | A |
| 5406630 | Piosenka et al. | Apr 1995 | A |
| 5448045 | Clark | Sep 1995 | A |
| 5453601 | Rosen | Sep 1995 | A |
| 5511121 | Yacobi | Apr 1996 | A |
| 5557518 | Rosen | Sep 1996 | A |
| 5604801 | Dolan et al. | Feb 1997 | A |
| 5615269 | Micali | Mar 1997 | A |
| 5623637 | Jones et al. | Apr 1997 | A |
| 5638446 | Rubin | Jun 1997 | A |
| 5659616 | Sudia | Aug 1997 | A |
| 5668878 | Brands | Sep 1997 | A |
| 5671279 | Elgamal | Sep 1997 | A |
| 5677955 | Doggett et al. | Oct 1997 | A |
| 5680455 | Linkser et al. | Oct 1997 | A |
| 5689565 | Spies et al. | Nov 1997 | A |
| 5694471 | Chen et al. | Dec 1997 | A |
| 5703949 | Rosen | Dec 1997 | A |
| 5706427 | Tabuki | Jan 1998 | A |
| 5717989 | Tozzoli et al. | Feb 1998 | A |
| 5721781 | Deo et al. | Feb 1998 | A |
| 5745571 | Zuk | Apr 1998 | A |
| 5745574 | Muftic | Apr 1998 | A |
| 5754772 | Leaf | May 1998 | A |
| 5784612 | Crane et al. | Jul 1998 | A |
| 5790677 | Fox et al. | Aug 1998 | A |
| 5809144 | Sirbu et al. | Sep 1998 | A |
| 5815657 | Williams et al. | Sep 1998 | A |
| 5841866 | Bruwer et al. | Nov 1998 | A |
| 5842211 | Horadan et al. | Nov 1998 | A |
| 5845260 | Nakano et al. | Dec 1998 | A |
| 5847374 | Menconi | Dec 1998 | A |
| 5850442 | Muftic | Dec 1998 | A |
| 5861662 | Candelore | Jan 1999 | A |
| 5870473 | Boesch et al. | Feb 1999 | A |
| 5889863 | Weber | Mar 1999 | A |
| 5892900 | Ginter et al. | Apr 1999 | A |
| 5903882 | Asay et al. | May 1999 | A |
| 5909492 | Payne et al. | Jun 1999 | A |
| 5913210 | Call | Jun 1999 | A |
| 5920629 | Rosen | Jul 1999 | A |
| 5920847 | Kolling et al. | Jul 1999 | A |
| 5937068 | Audebert | Aug 1999 | A |
| 5943424 | Berger | Aug 1999 | A |
| 5944789 | Tzelnic et al. | Aug 1999 | A |
| 5956404 | Schneier et al. | Sep 1999 | A |
| 5958051 | Renaud et al. | Sep 1999 | A |
| 5970475 | Barnes et al. | Oct 1999 | A |
| 5987440 | O'Neil et al. | Nov 1999 | A |
| 5991750 | Watson | Nov 1999 | A |
| 6003007 | DiRienzo | Dec 1999 | A |
| 6003765 | Okamoto | Dec 1999 | A |
| 6014646 | Valee et al. | Jan 2000 | A |
| 6029150 | Kravitz | Feb 2000 | A |
| 6035402 | Vaeth et al. | Mar 2000 | A |
| 6038551 | Barlow et al. | Mar 2000 | A |
| 6039248 | Park et al. | Mar 2000 | A |
| 6044350 | Weiant, Jr. et al. | Mar 2000 | A |
| 6044462 | Zubeldia et al. | Mar 2000 | A |
| 6052785 | Lin et al. | Apr 2000 | A |
| 6067621 | Barlow et al. | May 2000 | A |
| 6072870 | Nguyen et al. | Jun 2000 | A |
| 6081790 | Rosen | Jun 2000 | A |
| 6085168 | Mori et al. | Jul 2000 | A |
| 6085321 | Gibbs et al. | Jul 2000 | A |
| 6092196 | Reiche | Jul 2000 | A |
| 6092201 | Turnbull et al. | Jul 2000 | A |
| 6105012 | Chang et al. | Aug 2000 | A |
| 6115642 | Brown et al. | Sep 2000 | A |
| 6125349 | Maher | Sep 2000 | A |
| 6134327 | Van Oorachot et al. | Oct 2000 | A |
| 6134550 | Van Oorachot et al. | Oct 2000 | A |
| 6138107 | Elgamal | Oct 2000 | A |
| 6141679 | Schaefer et al. | Oct 2000 | A |
| 6154844 | Touboul et al. | Nov 2000 | A |
| 6157721 | Shear et al. | Dec 2000 | A |
| 6157917 | Barber | Dec 2000 | A |
| 6157920 | Jakobsson et al. | Dec 2000 | A |
| 6157927 | Schaefer et al. | Dec 2000 | A |
| 6170058 | Kausik | Jan 2001 | B1 |
| 6175921 | Rosen | Jan 2001 | B1 |
| 6182052 | Fulton et al. | Jan 2001 | B1 |
| 6185683 | Ginter et al. | Feb 2001 | B1 |
| 6209091 | Sudia et al. | Mar 2001 | B1 |
| 6223291 | Puhl et al. | Apr 2001 | B1 |
| 6233339 | Kawano et al. | May 2001 | B1 |
| 6236972 | Shkedy | May 2001 | B1 |
| 6272675 | Schrab et al. | Aug 2001 | B1 |
| 6285991 | Powar | Sep 2001 | B1 |
| 6292569 | Shear et al. | Sep 2001 | B1 |
| 6301658 | Koehler | Oct 2001 | B1 |
| 6304658 | Kocher et al. | Oct 2001 | B1 |
| 6314517 | Moses et al. | Nov 2001 | B1 |
| 6324525 | Kramer et al. | Nov 2001 | B1 |
| 6327578 | Linehan | Dec 2001 | B1 |
| 6330551 | Burchetta et al. | Dec 2001 | B1 |
| 6341353 | Herman et al. | Jan 2002 | B1 |
| 6353812 | Frankel et al. | Mar 2002 | B2 |
| 6356878 | Walker et al. | Mar 2002 | B1 |
| 6363365 | Kou | Mar 2002 | B1 |
| 6363479 | Godfrey et al. | Mar 2002 | B1 |
| 6370249 | Van Oorachot | Apr 2002 | B1 |
| 6373950 | Rowney | Apr 2002 | B1 |
| 6385651 | Dancs et al. | May 2002 | B2 |
| 6449598 | Green et al. | Sep 2002 | B1 |
| 6477513 | Walker et al. | Nov 2002 | B1 |
| 6490358 | Geer, Jr. et al. | Dec 2002 | B1 |
| 6490367 | Carlsson et al. | Dec 2002 | B1 |
| 6496858 | Frailong et al. | Dec 2002 | B1 |
| 6510513 | Danieli | Jan 2003 | B1 |
| 6510518 | Jaffe et al. | Jan 2003 | B1 |
| 6523027 | Underwood | Feb 2003 | B1 |
| RE38070 | Spies et al. | Apr 2003 | E |
| 6560581 | Fox et al. | May 2003 | B1 |
| 6598027 | Breen, Jr. et al. | Jul 2003 | B1 |
| 6601233 | Underwood | Jul 2003 | B1 |
| 6601759 | Fife et al. | Aug 2003 | B2 |
| 6609128 | Underwood | Aug 2003 | B1 |
| 6633878 | Underwood | Oct 2003 | B1 |
| 6643701 | Aziz et al. | Nov 2003 | B1 |
| 6658568 | Ginter et al. | Dec 2003 | B1 |
| 6675153 | Cook et al. | Jan 2004 | B1 |
| 6704873 | Underwood | Mar 2004 | B1 |
| 6711679 | Guski et al. | Mar 2004 | B1 |
| 6715080 | Starkovich et al. | Mar 2004 | B1 |
| 6718470 | Adams et al. | Apr 2004 | B1 |
| 6718535 | Underwood | Apr 2004 | B1 |
| 6763459 | Corella | Jul 2004 | B1 |
| 6766454 | Riggins | Jul 2004 | B1 |
| 6853988 | Dickenson et al. | Feb 2005 | B1 |
| 6865674 | Mancini et al. | Mar 2005 | B1 |
| 6889325 | Sipman et al. | May 2005 | B1 |
| 6973571 | Lee et al. | Dec 2005 | B2 |
| 7000105 | Tallent, Jr. et al. | Feb 2006 | B2 |
| 7072870 | Tallent, Jr. et al. | Jul 2006 | B2 |
| 7076784 | Russell et al. | Jul 2006 | B1 |
| 7080251 | Fujishiro et al. | Jul 2006 | B2 |
| 7080409 | Eigeles | Jul 2006 | B2 |
| 7100195 | Underwood | Aug 2006 | B1 |
| 7130998 | Balfanz et al. | Oct 2006 | B2 |
| 7165178 | Gein et al. | Jan 2007 | B2 |
| 7167985 | Ahmed | Jan 2007 | B2 |
| 7177839 | Claxton | Feb 2007 | B1 |
| 7200573 | Miller et al. | Apr 2007 | B2 |
| 7206805 | McLaughlin, Jr. | Apr 2007 | B1 |
| 7424616 | Brandenberg et al. | Sep 2008 | B1 |
| 20010011255 | Asay et al. | Aug 2001 | A1 |
| 20010020228 | Cantu et al. | Sep 2001 | A1 |
| 20010034724 | Thieme | Oct 2001 | A1 |
| 20020029194 | Lewis et al. | Mar 2002 | A1 |
| 20020029200 | Dulin et al. | Mar 2002 | A1 |
| 20020029337 | Sudia | Mar 2002 | A1 |
| 20020029350 | Cooper et al. | Mar 2002 | A1 |
| 20020046188 | Burges et al. | Apr 2002 | A1 |
| 20020059143 | Frankel | May 2002 | A1 |
| 20020065695 | Francoeur et al. | May 2002 | A1 |
| 20020095579 | Yoshiura et al. | Jul 2002 | A1 |
| 20020112156 | Gien et al. | Aug 2002 | A1 |
| 20020124172 | Manahan | Sep 2002 | A1 |
| 20020128940 | Orrin et al. | Sep 2002 | A1 |
| 20020129248 | Wheeler et al. | Sep 2002 | A1 |
| 20030130958 | Narayanan et al. | Jul 2003 | A1 |
| 20040111379 | Hicks et al. | Jun 2004 | A1 |
| 20040148505 | Qiu | Jul 2004 | A1 |
| 20040187031 | Liddle | Sep 2004 | A1 |
| 20050114666 | Sudia | May 2005 | A1 |
| 20050132229 | Zhang et al. | Jun 2005 | A1 |
| 20060004670 | McKenny et al. | Jan 2006 | A1 |
| 20070073621 | Dulin et al. | Mar 2007 | A1 |
| 20070165208 | Cowburn et al. | Jul 2007 | A1 |
| 20080010665 | Hinton et al. | Jan 2008 | A1 |
| Number | Date | Country |
|---|---|---|
| 0 784 282 | Jul 1997 | EP |
| WO 9631965 | Oct 1996 | WO |
| WO 9826386 | Jun 1998 | WO |
| 9826385 | Aug 1998 | WO |
| WO 9922291 | May 1999 | WO |
| WO 0045564 | Aug 2000 | WO |
| WO 0067143 | Nov 2000 | WO |
| WO 0118717 | Mar 2001 | WO |
| Number | Date | Country | |
|---|---|---|---|
| 20060004670 A1 | Jan 2006 | US |
| Number | Date | Country | |
|---|---|---|---|
| 60155841 | Sep 1999 | US |
| Number | Date | Country | |
|---|---|---|---|
| Parent | 09657622 | Sep 2000 | US |
| Child | 10839728 | US |
