The US Patent and Trademark Office (USPTO) has published a patent application from Mastercard for a method and system uses blockchain for payment card verification at the point-of-sale (PoS).
Mastercard filed for the patent in December 2016. The new approach is intended to address card skimming and will involve retrieval of payment credentials from a third party source via a publicly accessible blockchain.
The two-way process will include storage of an encrypted payment card image on a computing device using private and public keys.
When a transaction is carried out using plastic or chip enabled cards, private key will be used by the system to decrypt the card image and cross-check the payment information.
Mastercard expects that the technical solution for sending and retrieval of payment credentials to and at a PoS device through third party data source will eliminate the need for carrying a payment instrument, thereby improving security.
A statement from Mastercard’s application read: “The use of a third party data source enables an individual to transact safely without concern for their payment credentials being skimmed from their payment instrument, or without having to even carry a payment instrument entirely.
“The transaction may be conducted via the display of a machine-readable code to the point of sale device, which may further prevent skimming as the reading of such a code can be more easily controlled via control of the underlying display; the display can be easily shielded and is often obscured when in a pocket or purse.”