Secure electronic payment methods

Abstract

This invention presents methods for secure electronic funds transfer and using electronic credit cards and debit cards in conducting purchases and making payments on the internet, over the phone, and when customer is not present. Methods described provide for generating instances of encrypted pay identifiers or pay identifier records, both of which are payer and receiver specific. Said pay identifiers are used in place of credit cards, debit cards, check numbers, and bank accounts, and as generated, are unique per transaction. Said pay identifiers if copied illegally cannot be used in a different transaction, therefore it discourages identity theft. Presented methods are perfect for use in hand held devices and in local, remote, and near field communication (NFC) payment applications.

1 . A four way method for electronically transferring funds from a payer having at least one pay object and a pay object account with a bank, through a trustee, to a receiver with a receiver account; said method using data strings comprising:
 a proxy pay identifier, an identifier password, a constant data string, a transfer amount, and a rule number;
 wherein said proxy pay identifier, said identifier password, and said constant data string are associated with at least one said pay object and pay object account; 
 wherein said rule number is associated with at least one of an encryption or hashing algorithm and its corresponding decryption or un-hashing algorithm; 
 said trustee performing the steps comprising: 
 verifying a payer name and an identity identifier of said payer; 
 verifying said pay object account number of said pay object; 
 verifying said payer name on said pay object account number and associated account information of said payer; 
 verifying the withdrawal rights of said payer in withdrawing funds from said pay object account number through said bank or a payment processor; 
 securely storing in a payer database of said trustee said pay object account number associated with said payer name and the account information of said payer and pay object account; 
 verifying a receiver name and an identity identifier of said receiver; 
 verifying a receiver account number of said receiver account; 
 verifying said receiver name on said receiver account number and associated account information of said receiver; 
 verifying the withdrawal rights of said receiver in withdrawing funds from said receiver account number through said bank or a payment processor; 
 securely storing in a receiver database of said trustee said receiver account number associated with said receiver name and account information of said receiver and said receiver account; 
 programming a plurality of different encryption and hashing algorithms and referencing each one of said encryption and hashing algorithm with a rule number allocated to at least one said receiver; 
 associating one of said rule number to said receiver account number and storing in said receiver database of said trustee; 
 delivering said rule number to said receiver; 
 delivering to said payer at least one application program activated by an access password, along with a payer data-set comprising said payer name, said proxy pay identifier, said identifier password, and said constant data string; 
   said payer performing the steps comprising:
 executing one said application program supplied by said trustee and entering said access password; 
 delivering said payer data-set comprising said payer name, said proxy pay identifier, said identifier password, and said constant data string to said application program; 
 entering a transfer amount in said application program; 
 asking said receiver for said rule number and entering said rule number in said application program; 
 having said application program applying the associated encryption or hashing algorithms of said rule number to at least one of the data fields of said payer data-set and said transfer amount, generating an encrypted pay identifier; 
 upon the successful execution of said application program delivering a temporary data record comprising said encrypted pay identifier, said payer name, and said rule number to said receiver; 
   said receiver delivering said temporary data record comprising said encrypted pay identifier, said payer name, and said rule number to said trustee;   said trustee performing the steps comprising:
 receiving said temporary data record from said receiver and retrieving said encrypted pay identifier, said payer name, and the rule number; 
 decrypting said encrypted pay identifier and retrieving said payer name, said proxy pay identifier, said identifier password, said constant data string, and said transfer amount; 
 matching the received said proxy pay identifier with said proxy pay identifier on said payer database and retrieving the associated said pay object account number, said payer name, and said pay object account information from said payer database; 
 validating the pending transaction by comparing said payer name received from said receiver and the payer name retrieved from said payer database; 
 retrieving the associated said receiver account number, and said receiver name from said receiver database by matching the received said rule number; 
 notifying said payer of a pending transaction of said payment amount to said receiver; 
 notifying said receiver of a pending transaction of said payment amount from said payer; 
 transmitting said payer name, the said pay object account number, and said transfer amount to said bank or said payment processor; 
 transmitting said receiver name, the said receiver account number, and said transfer amount to said bank or said payment processor; 
   said bank performing the steps comprising:
 applying said transfer amount plus any payer applicable fees as a debit from said pay object account number; 
 applying said transfer amount less any fees applicable to said receiver as a credit to said receiver account number. 
   
     
     
         2 . The method of  claim 1 , wherein the comprising characters of said rule number, said payer name, a transfer amount, and at least one of the data fields of said payer data-set are dispersed within one another, comingled together, hashed, and/or encrypted with one another into one binary string called an encrypted pay identifier, using a programmed algorithm called by said rule number. 
     
     
         3 . The method of  claim 1 , wherein said encrypted pay identifier along with said rule number and said payer name are transferred to either of said trustee, to said payment processor, and/or to the bank for further processing. 
     
     
         4 . The method of  claim 1 , wherein either one or both of said identifier password, and said constant data string are of at least zero in length. 
     
     
         5 . The method of  claim 1 , further comprising the trustee reversing each one of said encrypted pay identifier to said encrypted pay identifier's original data fields through a decryption algorithm associated with the same rule number used in the encryption and/or hashing process. 
     
     
         6 . The method of  claim 1 , wherein said application program is executed on at least one of a processor unit, a plug-in module, an intelligent card, a telephonic computer device, a portable computerized device, a built-in module, a receiver's computerized pay terminal, a vending or dispensing machine of sorts, or a computerized device; where said application program is executed remotely through at least one of a link to said trustee computer system, comprising a wired link, a wireless link, a data bandwidth, a telephone link, and/or the internet. 
     
     
         7 . The method of  claim 1 , wherein said encrypted pay identifier is stored in the form of a two dimensional, or multidimensional bar code, an optical or laser readable format, in an RFID (Radio Frequency Identification) card, a plug-in module, a magnetic card, an intelligent card, a telephonic computer device, a portable computerized device, a built-in module, a receiver's computerized pay terminal, a vending or dispensing machine of sorts, or a computerized device; where said encrypted pay identifier is delivered through a wired port, NFC (Near Field Communication) device, wireless link, a data bandwidth, a telephone link, and/or the internet linked to said trustee computer system. 
     
     
         8 . The method of  claim 1 , wherein said application program is executed using computerized communication networks and one or more of devices comprising a said payer computer device, a said receiver computer terminal, a said trustee computer system, and/or a pay terminal of sorts. 
     
     
         9 . The method of  claim 1 , wherein said bank or said payment processor further performs functions of the trustee. 
     
     
         10 . The method of  claim 1 , further comprising the trustee engaging in a contractual relationship with at least one of said bank or said payment processor. 
     
     
         11 . A four way method for electronically transferring funds from a payer having at least one pay object and a pay object account with a bank, through a trustee, to a receiver with a receiver account; said method using data strings comprising:
 a proxy pay identifier, an identifier password, a constant data string, a transfer amount, and a rule number;
 wherein said proxy pay identifier, said identifier password, and said constant data string are associated with at least one said pay object and pay object account; 
 wherein said rule number is associated with at least one of an encryption or hashing algorithm and its corresponding decryption or un-hashing algorithm; 
 said trustee performing the steps comprising: 
 verifying a payer name and an identity identifier of said payer; 
 verifying said pay object account number of said pay object; 
 verifying said payer name on said pay object account number and associated account information of said payer; 
 verifying the withdrawal rights of said payer in withdrawing funds from said pay object account number through said bank or a payment processor; 
 securely storing in a payer database of said trustee said pay object account number associated with said payer name and the account information of said payer and pay object account; 
 verifying a receiver name and an identity identifier of said receiver; 
 verifying a receiver account number of said receiver account; 
 verifying said receiver name on said receiver account number and associated account information of said receiver; 
 verifying the withdrawal rights of said receiver in withdrawing funds from said receiver account number through said bank or a payment processor; 
 securely storing in a receiver database of said trustee said receiver account number associated with said receiver name and account information of said receiver and said receiver account; 
 programming a plurality of different encryption and hashing algorithms and referencing each one of said encryption and hashing algorithm with a rule number allocated to at least one said receiver; 
 associating one of said rule number to said receiver account number and storing in said receiver database of said trustee; 
 delivering said rule number to said receiver; 
 delivering to said payer at least one application program activated by an access password, along with a payer data-set comprising said payer name, said proxy pay identifier, said identifier password; 
   said payer performing the steps comprising:
 executing one said application program supplied by said trustee and entering said access password; 
 delivering said payer data-set comprising said payer name, said proxy pay identifier, said identifier password, and said constant data string to said application program; 
 entering a transfer amount in said application program; 
 asking said receiver for said rule number and entering said rule number in said application program; 
 having said application program applying the associated encryption, comingling, or hashing algorithms of said rule number to at least one of the data fields of said payer data-set and said transfer amount, generating a pay identifier record; 
 upon the successful execution of said application program transmitting said pay identifier record and said rule number to said trustee via a secure network; 
   said trustee performing the steps comprising:
 receiving said pay identifier record and said rule number from the payer; 
 disassembling said pay identifier record and retrieving said proxy pay identifier, said identifier password, said payer name, and said transfer amount from said pay identifier record; 
 matching the received said proxy pay identifier with said proxy pay identifier on said payer database and retrieving the associated said pay object account number, said payer name, and said pay object account information from said payer database; 
 validating the pending transaction by comparing said payer name received from said trustee and the payer name retrieved from said payer database; 
 retrieving the associated said receiver account number, and said receiver name and the from said receiver database by matching the received said rule number; 
 notifying said payer of a pending transaction of said payment amount to said receiver; 
 notifying said receiver of a pending transaction of said payment amount from said payer; 
 transmitting said payer name, the said pay object account number, and said transfer amount to said bank or said payment processor; 
 transmitting said receiver name, the said receiver account number, and said transfer amount to said bank or said payment processor; 
   said bank performing the steps comprising:
 applying said transfer amount plus any payer applicable fees as a debit from said pay object account number; 
 applying said transfer amount less any fees applicable to said receiver as a credit to said receiver account number. 
   
     
     
         12 . The method of  claim 11 , wherein said pay identifier record is a binary string comprising the characters of said payer name, said rule number, a transfer amount, and at least one of the data fields of said payer data-set, where in delivering said pay identifier record to said trustee at least one of the data fields of said pay identifier record is hashed, encrypted, comingled, or dispersed throughout said binary string. 
     
     
         13 . The method of  claim 11 , wherein said pay identifier record comprising characters of said rule number, a transfer amount, and a hash of at least one of the data fields of said payer data-set and said payer name. 
     
     
         14 . The method of  claim 11 , wherein at least one of the data fields of said pay identifier record and said rule number are transferred to said trustee, to the bank, or to said payment processor, unencrypted and unaltered. 
     
     
         15 . The method of  claim 11 , wherein said application program is executed on at least one of a processor unit, a plug-in module, an intelligent card, a telephonic computer device, a portable computerized device, a built-in module, a receiver's computerized pay terminal, a vending or dispensing machine of sorts, or a computerized device; where said application program is executed remotely through at least one of a link to said trustee computer system, comprising a wired link, a wireless link, a data bandwidth, a telephone link, and/or the internet. 
     
     
         16 . The method of  claim 11 , wherein said pay identifier record is stored in the form of a two dimensional, or multidimensional bar code, an optical or laser readable format, in an RFID (Radio Frequency Identification) card, a plug-in module, a magnetic card, an intelligent card, a telephonic computer device, a portable computerized device, a built-in module, a receiver's computerized pay terminal, a vending or dispensing machine of sorts, or a computerized device; where said pay identifier record is delivered through a wired port, NFC device, wireless link, a data bandwidth, a telephone link, and/or the internet linked to said trustee computer system. 
     
     
         17 . The method of  claim 11 , wherein said application program is executed using computerized communication networks and one or more of devices comprising a said payer computer device, a said receiver computer terminal, and/or a said trustee computer system, communicating in any modes of local, NFC, remote, or a mix thereof. 
     
     
         18 . The method of  claim 11 , wherein said bank or said payment processor further performs functions of the trustee. 
     
     
         19 . The method of  claim 11 , further comprising the trustee engaging in a contractual relationship with at least one of said bank or said payment processor. 
     
     
         20 . A method for transferring funds or charging an amount electronically, wherein a bank, or a payment processor receives from a receiver of funds one of an encrypted pay identifier comprising a hash of at least one of a payer name, a pay object account number, a receiver name, a receiver account number, a payment amount, and one of a rule number, through a trustee.