Discover Financial Services Increases Transaction Processing Speed by 66% on AWS

Through its payment services, Discover Financial Services (Discover) facilitates millions of daily transactions while working to drive value and adapt quickly to support new business partnerships. When Discover’s payments team began migrating away from a legacy mainframe to better support resourcing, speed, and flexibility, it chose Amazon Web Services (AWS) to support a scalable solution. By working to migrate its card settlement environment to an architecture on AWS, Discover delivered security and enhanced the developer experience while increasing processing speed and reducing the time to adopt pricing changes.

Discover provides banking and credit products and acts as a payments partner through the Discover Global Network, which is made up of Discover Network, PULSE, and Diners Club International. The network has acceptance in more than 200 countries and territories and includes more than 270 million global cardholders. It is also accepted at millions of merchants worldwide and has a goal to proactively grow merchant acceptance. Among Discover’s payment services is settlement: the process of moving money between organizations in the transaction life cycle.

For settlement processing, the Discover Network, which handles the everyday merchant usage of Discover cards, relied on a dated mainframe infrastructure. Discover realized that it needed to find staff resources to support the mainframe technology. Furthermore, the technology only supported Discover Network, and Discover wanted to extend support to PULSE and Diners Club International.

Discover also wanted to improve its turnaround time to implement pricing changes for interchange fees, the transaction fee charged to its clients. Implementing these changes helps support the company’s fee product offerings in the marketplace. “There is a lot of competitiveness in payments and a lot of opportunity to drive more value from the settlement process,” says Ewen McPherson, director of application development at Discover. “This involves making changes more frequently to respond to marketplace needs.” In addition to faster pricing changes, Discover also hoped to bring in multicurrency capabilities.

The company started developing a solution on premises but ultimately decided to engage AWS. Using AWS could improve data processing elasticity, help build automation, and increase speed to market. To upskill its teams, Discover participated in three different 3-day AWS Training courses provided by an AWS Training Partner. These experiences prepared team members for the AWS Certified Solutions Architect – Associate examination, which validates the ability to design and implement distributed systems on AWS, and resulted in multiple team members achieving this AWS Certification.

The first phase of the project began with the migration of the Discover Network pricing engine to AWS. In the interim, Discover also adopted a multicurrency add-on using AWS to onboard new acquiring partners with multicurrency support. The pricing engine went into production in AWS in June 2021 after an 18-month implementation process.

Discover deployed a card settlement solution that relies on Amazon Simple Storage Service (Amazon S3), an object storage service that offers industry-leading scalability, data availability, security, and performance. Using AWS Direct Connect, a cloud service that links user networks directly to AWS, Discover migrates transactions into Amazon S3 for pricing and settlement. Discover also relies on Amazon Relational Database Service (Amazon RDS) for MariaDB—which makes it easy to set up, operate, and scale MariaDB server deployments in the cloud—to support secure transactions. Before transferring transactions to AWS, Discover’s security processes tokenize sensitive information using services that run in data centers and use supporting databases on Amazon RDS for MariaDB.

Using AWS helped Discover deliver the required security capabilities and follow the Payment Card Industry Data Security Standard (PCI DSS) for protecting cardholder data. “We’ve built a secure environment with localized trust boundaries and encryption of data at rest and in transit, with secure authentication and authorization processes around it,” says Simon Dalton, senior principal application architect at Discover. Using AWS also facilitated automation, delivering an advanced continuous integration and continuous delivery capability that supports agility and elasticity for both AWS infrastructure and applications.

Discover uses AWS Lambda, a serverless, event-driven compute service, to orchestrate data transfer and assess content entering Amazon S3 to determine compute needs. To calculate fees using configuration rules, it relies on Amazon EMR—a solution for rapidly processing, analyzing, and applying machine learning to big data using open-source frameworks—in conjunction with Apache Spark. The team also uses Amazon DynamoDB, a fully managed, serverless, key-value NoSQL database designed to run high-performance applications at any scale, as a data store for its pricing information.

“The suite of resources and the maturity of the tools on AWS have helped improve our developer experience,” says Dalton. Additionally, by reducing operational tasks on AWS, Discover has helped engineering teams focus on business innovation. And by embracing automation, it has enhanced developer efficiency. Discover expects the solution will save almost 93 percent on costs over 5 years compared with an on-premises solution.

On AWS, Discover delivers faster processing and is moving toward offering faster payments. “We have complex pricing rules that we run on each transaction, and we’re able to process 1 day’s worth of files from acquirers and payment processors in 1.5 hours and four million transaction records in 9 minutes,” says Dalton. The team can also implement pricing changes more quickly, helping it onboard merchants faster and adapt to marketplace changes to grow its client base. “On AWS, we’re able to adopt pricing changes within 3 weeks, whereas before it took at least 6 months,” says Dalton. The solution also supports processing in approximately 12 currencies, with more to come—an innovation that helps Discover onboard more global clients.

Discover is now planning to migrate the rest of its settlement processing to AWS, further enhancing its application modernization on AWS. This includes migrating nonpricing functions and transactions from the Diners Club International network into AWS for settlement processing. The company also plans to start migrating other core systems on its payment network—such as its authorizations environment—to AWS. “We’re helping the organization continue to progress,” says McPherson.