Method and system for real time online debit transactions
An online payment method is disclosed which permits users to make realtime debit card payments over the Internet. The payor and payee pre-register with the system by sending their PAN, encrypted PIN and encryption key to the system database using a debit card reader, and then enter user names and secret IDs to be associated with the PAN and PIN numbers. When an online transaction is made the payor enters its user name and ID which is sent to the system along with the transaction amount and the payee user name. The system sends out a standard POS transaction using the stored PAN, encrypted PIN and encryption key. If approved it sends out a credit POS transaction to the payee in the same way.
1. A method for online debit payments to a payee by a payor using a central payment system and a debit card issued by a financial institution having associated PAN and PIN numbers said PAN and PIN numbers being associated by said financial institution with said debit card, the method comprising:
a) said payor registering with said central payment system by:
i) entering said payor's PAN number;
ii) entering said payor's PIN number;
iii) encrypting said payor's PIN number with an encryption key and communicating said PAN number and encrypted PIN number and encryption key to a database maintained by the system and storing said PAN number and encrypted PIN number and encryption key;
iv) said payor entering a user name and a secret ID number, different from said payor's PIN number, which are associated with the stored PAN and encrypted PIN numbers and encryption key;
b) said payee registering with said central payment system by:
i) storing said payee's PAN number;
ii) said payee entering a payee PIN number;
iii) encrypting said payee's PIN number and communicating said payee's PAN number and encrypted payee PIN number and encryption key to a database maintained by the system, and storing said payee's PAN number and encrypted payee PIN number and encryption key;
iv) said payee entering a user name and a secret ID number, different from the payee PIN number, which are associated with the stored payee's PAN and encrypted payee PIN number;
c) said payor making an online debit payment by:
i) displaying to said payor a payment web page with the amount of said online debit payment transaction;
ii) said payor entering said payor's user name and secret ID number;
iii) communicating said payor's user name and secret ID number, the amount of said online debit payment transaction and said payee's user name to the system server;
iv) said system validating said payor's user name and secret ID number, validating said payee's user name and retrieving said payor's PAN and encrypted PIN numbers and encryption key and sending a debit POS transaction to said financial institution in the amount of said online debit payment transaction;
v) said financial institution decrypting said PIN number and approving or disapproving said debit POS transaction;
vi) if said POS transaction is approved, retrieving said payee's PAN and encrypted PIN numbers and encryption key and sending a second POS transaction crediting said payee's account.
2. The method of claim 1 wherein said payor enters said amount of said transaction and said payee's user name on said web page prior to communicating said payor's user name and secret ID number, the amount of said online debit payment transaction and said payee's user name to the system server.
3. The method of claim 1 wherein said amount of said transaction and said payee's user name are served up to said payor with said web page.
4. The method of claim 3 wherein said web page is served up to said payor's internet browser by said payee's server.
5. The method of claim 3 wherein said web page is served up to said payor's internet browser by said payee's financial institution's server.
6. The method of claim 1 wherein said online transaction is carried out at the web site of said payee, and said payor selects a debit payment option for carrying out said online transaction prior to being served up said web page by said payee.
7. The method of claim 6 wherein said payee's user name is communicated to said system server upon selection of said debit payment option.
8. The method of claim 1 wherein said payor's PAN number is entered by reading said PAN number from a debit card issued by a financial institution by a card reader.
9. The method of claim 1 wherein said payor's PIN number is entered by entering said PIN number on a physical PIN pad.
10. The method of claim 1 comprising the further step of said sending a receipt to said payee after said second POS transaction has completed.
11. The method of claim 1 wherein said payor's PIN number is decrypted and stored at said system server, and re-encrypted with each POS transaction.
12. The method of claim 1 wherein said payor enters a plurality of payments to a plurality of payees on a single payment web page.
13. The method of claim 9 wherein said payor's PAN number is entered from said debit card by a debit card reader, and said PIN number is encrypted by said PIN pad using said encryption key.