MasterCard has filed a new patent that can authenticate coupons via blockchain technology. The financial services giant is looking to reduce risks concerning data manipulation when it comes to systems that store coupon data.
According to the patent titled “Method and System for Authentication of Coupons via Blockchain,” the patent explored the “authentication of coupons using a blockchain, specifically the storage of coupon data in a blockchain to ensure redemption only by authorized individuals and immutability of coupon data.”
While the patent was filed on November 29, 2017, it was published by the U.S. Patent and Trademark Office on May 31, 2018.
Coupons Can Cause Severe and Catastrophic Losses for Businesses
Coupons can be useful tools; however, MasterCard said:
“A mass redemption of the coupon at the entity can result in a significant, and sometimes catastrophic, loss that cannot be offset by any related increase in regular business.”
Some businesses have, therefore, issued unique coupons that can only be redeemed once or a certain number of times. The financial services giant, however, noted that coupons could be shared or transferred to others.
Some companies, as a result, have developed systems that associate coupons with a specific account. However, these systems are fairly resource-intensive, costly, and can be susceptible to data manipulation.
“Thus, there is a need for a technological solution whereby coupons can be issued to an individual for redemption only by the individual, and where the system relies on a publicly accessible data source to enable implementation without the use of additional resources for the issuing entity.”
Blockchain Technology Can Help Authenticate Coupons
MasterCard believes that they can leverage blockchain technology to store and track coupon data that does not require the company to issue the coupons to store or manage that data. The ability to track and not store and manage data, therefore, frees up resources and processing power for the company.
Furthermore, MasterCard emphasized that:
“The use of a blockchain ensures that the coupon data is publicly accessible, such as for viewing by the associated individuals as well as the issuing entities and that such data is immutable and not subject to tampering or fraud.”
The blockchain-based coupon model can, therefore, reduce the chances of a merchant redeeming fraudulent or used coupons. Companies can begin issue coupons with “higher loss.” Larger discounts can entice and attract more consumers and increase the company’s overall revenue.