Radio Device Based Transactions At A Point Of Sale Terminal

What is this patent about?

’647 is related to the field of mobile commerce , specifically systems and methods for aggregating and managing loyalty programs, rewards, and gift cards on a mobile device. The background acknowledges the increasing prevalence of retailer loyalty programs and the challenges consumers face in managing multiple accounts. It also recognizes the need for retailers to build trusted relationships with mobile customers and gain visibility into their redemption habits.

The underlying idea behind ’647 is to create a virtual account on a mobile device that aggregates various retailer loyalty programs, gift cards, and discount offers. This account is linked to the user's mobile device and can be used at point-of-sale (POS) terminals without directly exposing the user's financial account information. The system uses a unique, transaction-specific code to identify the user and authorize the transaction.

The claims of ’647 focus on enabling a POS system to complete a transaction initiated from a radio device (e.g., a mobile phone) without the POS system ever receiving a financial account number. The claims cover methods performed by both an accounting server and the POS system itself. The key is the exchange of a transaction-specific unique code instead of sensitive financial data, which is then used to determine a device-specific virtual account ID.

In practice, a user presents a discount code displayed on their mobile device at a participating retailer's POS terminal. The POS system sends this code to an accounting server, which uses it to identify the user's virtual account and authorize the transaction. The accounting server then sends an authorization message back to the POS system, allowing the transaction to proceed. The user's actual financial information is never shared with the POS system, enhancing security and privacy.

This approach differs from traditional loyalty programs and gift card systems by centralizing account management and using a mobile device identifier to link transactions to a user's virtual account. Instead of requiring users to carry multiple cards or remember numerous account numbers, they can access all their rewards and discounts through a single mobile application. This also provides retailers with valuable data on customer spending habits and redemption patterns, enabling them to personalize offers and improve customer engagement.