This decision concerns using NFC technology for conducting payments. However, since the distinguishing features were considered non-technical, the EPO refused grant. Here are the practical takeaways from the decision T 0801/20 (NFC mobile wallet processing system/PAYPAL) of June 1, 2023 of the Technical Board of Appeal 3.5.01.
The Board in charge summarized the subject-matter of the application underlying the present decision as follows:
1.1 The invention concerns using near field communication (NFC) to make payments (page 1, third paragraph of the published application).
1.2 Looking at Figure 1, a user initiates a payment transaction by sending a transaction request from their NFC-enabled mobile device 102, such as a phone, to a transaction management system (TMS) 130. The TMS 130 then creates a pending transaction record and sends to the user’s device an NFC-formatted transaction identifier (“checkout token”). The user passes the token to a merchant system 108, e.g. by tapping their phone on an NFC reader 104 (page 45, lines 4 to 25).
The merchant system 108 then submits a merchant transaction request to the TMS 130, which includes the checkout token and some transaction details. The TMS updates the pending transaction record and sends the transaction details to the user along with a list of available payment accounts from which the user can select. Once the TMS receives the user’s selection, it completes the payment (page 45, line 22 to page 47, line 27).
1.3 An essential aspect of the claimed invention is that the merchant system transmits the transaction details to the TMS in two steps: the merchant’s identifier is sent with the transaction request, while the transaction amount is sent later. This is because the transaction amount might not have been calculated yet when the merchant’s transaction request is transmitted. The TMS also forwards the received pieces of transaction information to the user’s mobile device in separate steps (page 38, line 19 to page 39, line 19).
Fig. 1 of WO 2015/130967 A1
Claim 8 of the Main Request
A method executed by a transaction management system, TMS, comprising:
receiving, from a mobile device operated by a user, a request to initiate transaction processing associated with a transaction involving said user; and
transmitting, to said mobile device, a checkout token for use with said transaction, said checkout token formatted for near field communication (“NFC”) transmission from said mobile device to an NFC reader of a merchant system associated with said transaction;
creating a pending transaction record associated with the checkout token, which includes information identifying the user, in a transaction queue;
receiving, from said merchant system, a message containing (i) the checkout token received from the mobile device via an NFC communication session between the mobile device and the NFC reader, and (ii) details of a transaction involving said merchant and said user including a merchant identifier but not a transaction amount;
updating the pending transaction record with the details of the transaction by matching the message from the merchant and the pending transaction record using the checkout token;
transmitting payment accounts and information identifying the merchant for display by the mobile device;
receiving a transaction amount from said merchant system;
updating the pending transaction record using the transaction amount;
transmitting a message to the mobile device so that the display of the mobile device is updated to include the transaction amount as well as a list of available payment accounts that can be used in the transaction and information identifying the merchant;
receiving, from said mobile device, a transaction confirmation request message including a user selection of one of the available payment accounts; and
identifying, based on information from said transaction confirmation request message, an actual payment account corresponding to said user selection for use in completing said transaction.
Is it patentable?
The application underlying the present decision was rejected by the first instance Examining Division due to lack of inventive step (cf. decision, “Summary of Facts and Submissions”). With the aim to set this decision aside, the applicant lodged an appeal. At appeal stage, as a first step, the Board in charge determined the distinguishing features of claim 8 over the closest prior art document D1 as follows:
(i) The merchant system transmits the transaction details to the TMS in two steps: first, it sends the merchant’s identifier, and then the transaction amount. After each step, the TMS updates the pending transaction record and forwards the received information to the user.
(ii) The TMS sends a list of “available” payment accounts from which the user can select to complete the payment.
According to the appellant’s arguments, specifically the claimed “amount” according to distinguishing feature (i) would be of technical nature as it would refer to a quantity:
2.3 As regards feature (i), the appellant argued that an “amount” was technical as it represented a quantity. It was inconsistent to say that an amount was technical when it referred to a physical parameter, such as voltage, but non-technical when it referred to money. Furthermore, transmitting and receiving data to/from a device, as well as updating a data record, were all technical processes.
However, the Board in charge disagreed and considered to claimed “amount” non-technical and reasoned its finding as follows:
2.4 The Board notes that an amount is just a number and per se non-technical. Whether this number represents technical or non-technical data depends on the context. However, data alone – whether technical or not – does not convey technical character to the method that processes it. Method steps contribute to the technical character of the invention only if they contribute to the solution of a technical problem by providing a technical effect (e.g. T 154/04 – Estimating sales activity/DUNS LICENSING, point 20).
Furthermore, the appellant considered the two-step approach reflected in distinguishing feature (i) to be technical and argued as follows:
2.5 The appellant further argued that the two-step transmission and display of transaction details enabled the user to verify the merchant’s identity while waiting for the transaction amount to be determined. Receiving transaction information piece by piece was easier for the user to process, saved time and reduced latency.
Again, the Board did not follow the appellant’s arguments:
2.6 The Board does not find this argument convincing. Displaying information piece by piece or all at once is a matter of user preference. Some users may prefer to receive the merchant details in advance, others may prefer to see all relevant information together. Even if a user receives the merchant’s identity beforehand, they may still choose to wait until all transaction details arrive before reviewing them. Thus, any effect the displayed information might have depends on the user and the user’s reaction to this information. Such indirect effects cannot be considered when assessing inventive step (see e.g. T 1670/07 – Shopping with mobile device/NOKIA, point 11). Although displaying information piece by piece may make it easier to evaluate and, hence, lower the user’s cognitive burden, this is not a technical effect (see e.g. T 1741/08 – GUI layout/SAP, point 2.1.6).
With respect to distinguishing feature (ii), the appellant was of the opinion that this feature would lead to a bandwidth reduction:
2.7 As regards feature (ii), the appellant argued that by providing a list of accounts that were suitable for the transaction, the system required less bandwidth and computing resources. This was because, on the one hand, non-usable accounts were not transmitted, and, on the other hand, the system did not have to process non-viable account selections.
However, the Board noted that the payment accounts are even transmitted twice and thus doubts that this may result in improved transmission efficiency:
2.8 The Board is not convinced that the effects identified by the appellant are achieved. According to the claim, the TMS transmits payment accounts to the user’s mobile device twice: first, it transmits some unspecified payment accounts, and then, it transmits “a list of available payment accounts that can be used in the transaction”. …
Against this background, the Board concluded that both features (i) and (ii) are non-technical and thus have to be ignored for the assessment of inventive step. Hence, D1 would render obvious the claimed subject-matter of claim 8 of the Main Request.
Since claim 7 of the Auxiliary Request was also considered non-inventive, the Board in charge dismissed the appeal.
You can read the full decision here: T 0801/20 (NFC mobile wallet processing system/PAYPAL) of June 1, 2023