JCB Takes Initiative to Create Blockchain-based Micropayment Solution for IoT

Like in Retail Marketing and Sales, Financial Service industry is also experiencing a rise in Micro-personalization experiences. Micropayment Solution is a raging trend in Blockchain-based financial services.

As new networks, such as 5G, deploy and the use of Internet of Things (IoT) devices grow, so will the need for automated and machine-to-machine micropayment solutions. JCB Co., Ltd. and Keychain GK have developed a novel infrastructure for processing credit-based micropayments between IoT devices. The innovation promises to enable direct human-to-machine and machine-to-machine payments at scale without the confines of credit cards.

Today, JCB is a major global payment brand and a leading credit card issuer and acquirer in Japan. JCB launched its card business in Japan in 1961 and began expanding worldwide in 1981. Its acceptance network includes about 35 million merchants in the world. JCB cards are now issued in more than 20 countries and territories with more than 140 million cardmembers.

Mobile payment apps enabled the common mobile user to pay with their phone, however, the current payment infrastructure does not support tens of billions of IoT devices. Use cases in point: electric vehicles automatically paying for charging, or a farmer receiving payment for produce to a mobile device while offline. Such an infrastructure needs to handle vast cybersecurity and operational risks related to identity fraud, hacking, privacy and denial of service.

JCB and Keychain have begun solving these challenges by implementing a new blockchain and distributed ledger-based payment infrastructure that mitigates the risks of IoT micropayments.

Micropayment Infrastructure

JCB and Keychain developed the solution based on digital identity, delegated transaction approval, and secure transaction archival (joint Japan patent pending #2021-00571).

1. Integrated digital identity

– Each IoT device has a unique, blockchain-based, self-sovereign identity associated with customer identity. This establishes a necessary technical basis for behavior attribution and regulatory compliance.

2. Delegated transaction approval at the network’s edge

– Using Keychain Core’s data provenance capability, the cost, operational risks, and financial risks of payment processing are pushed towards the edges of the network. This enables mitigating large-scale cybersecurity attacks with comparatively large-scale defenses.
– Transaction approval is processed in real time by devices geographically closer to the location of the transaction.
– The result is a smoother, lower latency user experience and more scalable risk mitigation for the issuer.

3. Secure transaction record archival

– Using identity-based data provenance and security techniques, the system ensures that data is securely relayed to the issuer for compliance and integrity checking.

– The records integrate into conventional settlement systems, leveraging the digital identity-user mappings.

The go-to-market plan consists of enhancing the technology, practical real-world pilots, production infrastructure build out during 2021, and go-live in 2022.

Keychain Blockchain Technology

Keychain Core, Keychain’s flagship technology product, is a set of software building blocks that enable Keychain partners to easily exploit the power of blockchain and distributed ledger technology. With Keychain Core, Keychain partners reduce operational risks related to data security and achieve new patterns of business. Keychain Core natively supports a wide range of devices including personal computers, tablets, smart phones, smart watches, and Internet of Things (IoT) devices easy to integrate with existing systems and applications.

Keychain Core main elements are the following:
1. Self-sovereign identity
2. Data-centric security
3. Secure workflows
4. Custom digital assets

As part of its international growth strategy, JCB has formed alliances with hundreds of leading banks and financial institutions globally to increase merchant coverage and cardmember base. As a comprehensive payment solution provider, JCB commits to providing responsive and high-quality service and products to all customers worldwide.

Currently, Keychain is a leading technology provider that is building managed trust for the digital world. As a leading blockchain technology provider, Keychain aims to fortify operational integrity, reduce risks/cost, streamline business processes, and enable new patterns of business in finance, industry, and enterprise. Keychain’s technology has been recognized with prestigious awards including the Global Fintech Award from the Association of Banks in Singapore and the IoT Lab Special Jury Award from Japan’s Ministry of Economy Trade, and Industry.