System Overview
The online wallet system is designed using a microservices architecture with 12 specialized services organized into distinct domains. The system supports multiple payment methods for wallet top-ups and enables seamless money transfers between users on the same platform and collaborating platforms.
Core Business Services
1. User Management Service
Purpose: Complete user lifecycle management and identity verification
Technical Architecture:
•	Database: MySql/Mysql for persistent user data, Redis for session management
•	Authentication: JWT tokens with refresh token rotation
•	API Style: RESTful with GraphQL for complex queries
•	Security: bcrypt password hashing, rate limiting, account lockout mechanisms
Key Responsibilities:
•	User registration with email/phone verification
•	KYC (Know Your Customer) document verification and status tracking
•	Profile management (personal info, preferences, settings)
•	Account status management (active, suspended, frozen, closed)
•	User tier management (basic, premium, business accounts)
•	Device registration and management for security
API Endpoints:
POST /api/v1/users/register
POST /api/v1/users/verify-email
POST /api/v1/users/verify-phone
GET /api/v1/users/profile
PUT /api/v1/users/profile
POST /api/v1/users/kyc/upload
GET /api/v1/users/kyc/status
PUT /api/v1/users/preferences
POST /api/v1/users/change-password
POST /api/v1/users/reset-password
Events Published:
•	UserRegisteredEvent
•	UserVerifiedEvent
•	KYCStatusChangedEvent
•	ProfileUpdatedEvent
•	AccountStatusChangedEvent
Database Schema:
users (id, email, phone, password_hash, status, created_at, updated_at)
user_profiles (user_id, first_name, last_name, date_of_birth, address, kyc_status)
user_devices (user_id, device_id, device_type, last_login, is_trusted)
kyc_documents (user_id, document_type, document_url, verification_status)
2. Wallet Core Service
Purpose: Central financial engine managing wallet balances and core transaction processing
Technical Architecture:
•	Database: MySql/Mysql with strict ACID compliance
•	Pattern: CQRS (Command Query Responsibility Segregation) for read/write separation
•	Consistency: Event sourcing for complete audit trail
•	Caching: Redis for balance caching with TTL
•	Concurrency: Optimistic locking to prevent race conditions
Key Responsibilities:
•	Wallet balance management with real-time updates
•	Transaction processing with atomic operations
•	Account freezing/unfreezing capabilities
•	Multi-currency support (if needed)
•	Balance inquiries and history
•	Overdraft protection and limits enforcement
•	Wallet-to-wallet transfers within platform
API Endpoints:
GET /api/v1/wallet/{userId}/balance
POST /api/v1/wallet/{userId}/credit
POST /api/v1/wallet/{userId}/debit
POST /api/v1/wallet/{userId}/transfer
GET /api/v1/wallet/{userId}/transactions
PUT /api/v1/wallet/{userId}/freeze
PUT /api/v1/wallet/{userId}/unfreeze
GET /api/v1/wallet/{userId}/limits
Events Published:
•	WalletCreditedEvent
•	WalletDebitedEvent
•	TransferInitiatedEvent
•	TransferCompletedEvent
•	WalletFrozenEvent
•	BalanceThresholdReachedEvent
Database Schema:
wallets (user_id, balance, currency, status, daily_limit, monthly_limit)
wallet_transactions (id, wallet_id, type, amount, reference_id, status, timestamp)
wallet_limits (wallet_id, transaction_limit, daily_limit, monthly_limit)
frozen_wallets (wallet_id, reason, frozen_at, frozen_by)
Business Logic:
•	Implements double-entry bookkeeping principles
•	Maintains transaction atomicity using database transactions
•	Handles concurrent balance updates using SELECT FOR UPDATE
•	Implements circuit breaker pattern for external dependencies
3. Transaction Service
Purpose: Comprehensive transaction logging, auditing, and reconciliation
Technical Architecture:
•	Database: Mysql for transaction records, MongoDB for analytics
•	Pattern: Event sourcing for complete transaction history
•	Search: Elasticsearch for fast transaction searches
•	Reporting: Apache Spark for batch processing and reporting
Key Responsibilities:
•	Complete transaction logging and audit trails
•	Transaction status tracking and updates
•	Dispute management and resolution workflows
•	Reconciliation with external payment providers
•	Transaction analytics and reporting
•	Failed transaction retry mechanisms
•	Compliance reporting and data export
API Endpoints:
GET /api/v1/transactions/{userId}
GET /api/v1/transactions/{transactionId}
POST /api/v1/transactions/{transactionId}/dispute
GET /api/v1/transactions/search
GET /api/v1/transactions/export
POST /api/v1/transactions/{transactionId}/retry
GET /api/v1/transactions/reconciliation
Events Consumed:
•	WalletCreditedEvent
•	WalletDebitedEvent
•	PaymentProcessedEvent
•	TransferCompletedEvent
Database Schema:
transactions (id, user_id, type, amount, status, reference_id, created_at, updated_at)
transaction_details (transaction_id, source, destination, fees, taxes, exchange_rate)
transaction_status_history (transaction_id, status, timestamp, reason, updated_by)
disputes (id, transaction_id, reason, status, created_at, resolved_at)
reconciliation_reports (id, date, processed_count, failed_count, amount_reconciled)
Payment & Financial Services
4. Payment Gateway Service
Purpose: Multi-provider payment integration for wallet top-ups
Technical Architecture:
•	Integration Pattern: Adapter pattern for multiple payment providers
•	Security: PCI DSS compliance, tokenization for card data
•	Retry Logic: Exponential backoff for failed payments
•	Monitoring: Real-time payment success/failure metrics
Supported Payment Methods:
•	Credit/Debit Cards (Visa, MasterCard, American Express, Discover)
•	Net Banking (integration with 100+ banks)
•	UPI payments (Google Pay, PhonePe, Paytm, BHIM)
•	Digital wallets (PayPal, Apple Pay, Google Pay)
•	Bank transfers (NEFT, RTGS, IMPS)
•	Cryptocurrency (Bitcoin, Ethereum) — optional
Key Responsibilities:
•	Payment method routing and optimization
•	Transaction fee calculation and management
•	Payment status tracking and webhooks
•	Refund processing and management
•	Payment method validation and verification
•	PCI compliance and secure card data handling
•	Multi-currency payment processing
API Endpoints:
POST /api/v1/payments/initiate
GET /api/v1/payments/{paymentId}/status
POST /api/v1/payments/{paymentId}/confirm
POST /api/v1/payments/{paymentId}/cancel
POST /api/v1/payments/{paymentId}/refund
GET /api/v1/payments/methods
POST /api/v1/payments/validate-card
GET /api/v1/payments/fees/{method}/{amount}
Integration Partners:
•	Card Processing: Stripe, Razorpay, PayU, CCAvenue
•	UPI: NPCI, Razorpay UPI, PayU UPI
•	Net Banking: Individual bank APIs, Razorpay, PayU
•	International: PayPal, Stripe International
•	Crypto: Coinbase Commerce, BitPay (optional)
Database Schema:
payment_methods (id, user_id, type, provider, token, is_default, created_at)
payments (id, user_id, amount, method, provider, status, reference_id, created_at)
payment_fees (method, provider, percentage_fee, fixed_fee, min_fee, max_fee)
refunds (id, payment_id, amount, reason, status, processed_at)
5. Transfer Service
Purpose: Handles money transfers between users and external platforms
Technical Architecture:
•	Pattern: Saga pattern for distributed transactions
•	Queue: Message queues for reliable transfer processing
•	Retry: Dead letter queues for failed transfers
•	Idempotency: UUID-based idempotency keys
Key Responsibilities:
•	Peer-to-peer transfers within platform
•	Cross-platform transfers to collaborating systems
•	Bulk transfer operations for businesses
•	Scheduled and recurring transfers
•	Transfer limits and validation
•	International transfers (if supported)
•	Transfer fee calculation and collection
API Endpoints:
POST /api/v1/transfers/p2p
POST /api/v1/transfers/external
POST /api/v1/transfers/bulk
GET /api/v1/transfers/{transferId}/status
POST /api/v1/transfers/schedule
GET /api/v1/transfers/{userId}/history
POST /api/v1/transfers/{transferId}/cancel
GET /api/v1/transfers/fees/{type}/{amount}
Transfer Types:
•	Instant P2P: Real-time transfers between platform users
•	External Platform: API-based transfers to partner platforms
•	Bank Transfers: Direct bank account transfers
•	International: Cross-border transfers via SWIFT/correspondent banks
•	Bulk Transfers: CSV upload for multiple transfers
•	Scheduled: Future-dated transfers
Events Published:
•	TransferInitiatedEvent
•	TransferCompletedEvent
•	TransferFailedEvent
•	BulkTransferProcessedEvent
Database Schema:
transfers (id, sender_id, recipient_type, recipient_id, amount, fees, status, created_at)
external_transfers (transfer_id, platform_id, external_reference, api_response)
bulk_transfers (id, user_id, file_path, total_amount, processed_count, status)
scheduled_transfers (id, transfer_id, scheduled_date, recurring_type, next_execution)
6. Settlement Service
Purpose: Manages financial settlements and regulatory compliance
Technical Architecture:
•	Batch Processing: Scheduled settlement jobs
•	Reconciliation: Automated matching with bank statements
•	Reporting: Real-time settlement dashboards
•	Compliance: Regulatory reporting automation
Key Responsibilities:
•	Daily settlement processing with banks and partners
•	Merchant payout processing
•	Cross-platform settlement reconciliation
•	Regulatory compliance reporting (RBI, PCI, etc.)
•	Settlement fee calculation and collection
•	Dispute resolution for settlement discrepancies
•	Cash flow management and forecasting
API Endpoints:
POST /api/v1/settlements/initiate
GET /api/v1/settlements/{settlementId}/status
GET /api/v1/settlements/daily-report
POST /api/v1/settlements/reconcile
GET /api/v1/settlements/pending
POST /api/v1/settlements/dispute
Settlement Workflows:
•	T+0 Settlement: Real-time settlement for premium merchants
•	T+1 Settlement: Next-day settlement for standard merchants
•	Weekly Settlement: Consolidated weekly settlements
•	Manual Settlement: On-demand settlement requests
Security & Compliance Services
7. Authentication Service
Purpose: Centralized security and access control
Technical Architecture:
•	Protocol: OAuth 2.0 with PKCE, OpenID Connect
•	Tokens: JWT with short expiration, refresh token rotation
•	MFA: TOTP, SMS, email, biometric authentication
•	Security: Rate limiting, device fingerprinting, risk-based authentication
Key Responsibilities:
•	Multi-factor authentication (2FA/MFA)
•	Single sign-on (SSO) across services
•	JWT token lifecycle management
•	Session management and security
•	Device trust and registration
•	API key management for external integrations
•	Role-based access control (RBAC)
API Endpoints:
POST /api/v1/auth/login
POST /api/v1/auth/refresh
POST /api/v1/auth/logout
POST /api/v1/auth/mfa/enable
POST /api/v1/auth/mfa/verify
GET /api/v1/auth/devices
POST /api/v1/auth/device/trust
DELETE /api/v1/auth/device/{deviceId}
Security Features:
•	Password Policy: Minimum complexity requirements
•	Account Lockout: Temporary lockout after failed attempts
•	Suspicious Activity Detection: IP-based and behavioral analysis
•	Token Security: Short-lived access tokens, secure refresh tokens
•	Device Management: Trusted device registration and management
8. Fraud Detection Service
Purpose: Real-time fraud monitoring and prevention
Technical Architecture:
•	ML Pipeline: Real-time ML models using Apache Kafka and Apache Flink
•	Rules Engine: Configurable business rules for fraud detection
•	Scoring: Real-time risk scoring for transactions
•	Analytics: Historical pattern analysis and anomaly detection
Key Responsibilities:
•	Real-time transaction monitoring and scoring
•	Suspicious activity pattern detection
•	Account takeover prevention
•	Money laundering detection (AML)
•	Velocity checks and limit enforcement
•	Geolocation-based fraud detection
•	Machine learning model training and deployment
API Endpoints:
POST /api/v1/fraud/score-transaction
GET /api/v1/fraud/user-risk/{userId}
POST /api/v1/fraud/report-suspicious
GET /api/v1/fraud/alerts
PUT /api/v1/fraud/rules/{ruleId}
GET /api/v1/fraud/statistics

Detection Methods:
•	Velocity Fraud: Multiple transactions in short time
•	Geographic Fraud: Transactions from unusual locations
•	Behavioral Fraud: Unusual transaction patterns
•	Device Fraud: Transactions from suspicious devices
•	Network Fraud: Transactions from known bad IP ranges
•	Amount Fraud: Unusual transaction amounts
ML Models:
•	Anomaly Detection: Isolation Forest, One-Class SVM
•	Classification: Random Forest, XGBoost for fraud classification
•	Deep Learning: Neural networks for complex pattern recognition
•	Time Series: LSTM for temporal pattern analysis
9. Compliance Service
Purpose: Regulatory compliance and reporting
Technical Architecture:
•	Reporting Engine: Automated regulatory report generation
•	Data Pipeline: ETL processes for compliance data
•	Audit Trail: Immutable audit logs
•	Integration: APIs for regulatory body submissions
Key Responsibilities:
•	AML (Anti-Money Laundering) compliance
•	KYC (Know Your Customer) verification workflows
•	Suspicious Activity Report (SAR) generation
•	Transaction monitoring for compliance violations
•	Regulatory reporting (RBI, FINCEN, etc.)
•	Audit trail maintenance and reporting
•	Data retention and privacy compliance (GDPR, CCPA)
Compliance Requirements:
•	PCI DSS: Payment card industry security standards
•	RBI Guidelines: Reserve Bank of India regulations
•	PMLA: Prevention of Money Laundering Act
•	GDPR: General Data Protection Regulation
•	SOX: Sarbanes-Oxley Act compliance
Support & Infrastructure Services
10. Notification Service
Purpose: Multi-channel communication with users
Technical Architecture:
•	Message Queue: Apache Kafka for reliable message delivery
•	Templates: Dynamic template engine for personalization
•	Channels: SMS, Email, Push, In-app notifications
•	Delivery: Retry mechanisms and delivery tracking
Key Responsibilities:
•	Transaction notifications (SMS, email, push)
•	Account alerts and security notifications
•	Marketing communications and promotions
•	System maintenance and downtime notifications
•	Regulatory and compliance notifications
•	Multi-language support for notifications
•	Delivery preference management
API Endpoints:
POST /api/v1/notifications/send
GET /api/v1/notifications/{userId}/preferences
PUT /api/v1/notifications/{userId}/preferences
GET /api/v1/notifications/{userId}/history
POST /api/v1/notifications/template
GET /api/v1/notifications/delivery-status/{notificationId}
Notification Types:
•	Transactional: Payment confirmations, transfer receipts
•	Security: Login alerts, password changes, suspicious activity
•	Account: Balance updates, KYC status, account changes
•	Marketing: Promotions, new features, surveys
•	System: Maintenance, outages, service updates
11. Analytics Service
Purpose: Business intelligence and data analytics
Technical Architecture:
•	Data Warehouse: Apache Spark with Delta Lake
•	Real-time Analytics: Apache Kafka with Kafka Streams
•	Visualization: Grafana dashboards, custom analytics APIs
•	ML Pipeline: MLflow for model management
Key Responsibilities:
•	Transaction pattern analysis and insights
•	User behavior tracking and segmentation
•	Financial performance metrics and KPIs
•	Fraud pattern analysis and model training
•	Business intelligence dashboards
•	Predictive analytics for user retention
•	Revenue optimization and forecasting
API Endpoints:
GET /api/v1/analytics/transactions/summary
GET /api/v1/analytics/users/behavior
GET /api/v1/analytics/revenue/forecast
GET /api/v1/analytics/fraud/patterns
POST /api/v1/analytics/reports/generate
GET /api/v1/analytics/dashboards/{dashboardId}
Analytics Capabilities:
•	Real-time Dashboards: Live transaction monitoring
•	Cohort Analysis: User retention and engagement metrics
•	Funnel Analysis: Conversion tracking across user journeys
•	A/B Testing: Feature experimentation and optimization
•	Predictive Modeling: Churn prediction, lifetime value calculation
12. API Gateway
Purpose: Central entry point and traffic management
Technical Architecture:
•	Load Balancing: Round-robin, least connections, weighted routing
•	Security: OAuth integration, API key management, IP whitelisting
•	Monitoring: Request/response logging, performance metrics
•	Caching: Response caching for improved performance
Key Responsibilities:
•	Request routing and load balancing
•	API versioning and backward compatibility
•	Rate limiting and throttling
•	Request/response transformation
•	Authentication and authorization enforcement
•	API monitoring and analytics
•	Cross-origin resource sharing (CORS) handling
Features:
•	Circuit Breaker: Prevents cascade failures
•	Retry Logic: Configurable retry policies
•	Timeout Management: Request timeout configuration
•	Request Validation: Schema validation and sanitization
•	Response Caching: Intelligent caching strategies
Technology Stack Recommendations
Backend Services
•	Primary: Java 17+ with Spring Boot 3.x
•	Alternative: Node.js 18+ with Express/Fastify
•	High Performance: Go 1.19+ for latency-critical services
•	ML Services: Python 3.9+ with FastAPI
Databases
•	Primary Database: Mysql 14+ (ACID compliance)
•	Caching: Redis 7.x (session management, caching)
•	Analytics: MongoDB 6.x (flexible schema for analytics)
•	Search: Elasticsearch 8.x (transaction search, logging)
•	Time Series: InfluxDB (metrics and monitoring data)
Message Queue & Streaming
•	Event Streaming: Apache Kafka 3.x
•	Message Queue: RabbitMQ 3.x for point-to-point messaging
•	Task Queue: Celery with Redis backend
Infrastructure & DevOps
•	Containerization: Docker 20.x with Kubernetes 1.25+
•	Cloud Platform: AWS/Azure/GCP with multi-region deployment
•	Load Balancer: NGINX Plus or HAProxy
•	Service Mesh: Istio for advanced traffic management
•	Monitoring: Prometheus + Grafana, ELK Stack
•	CI/CD: Jenkins, GitLab CI, or GitHub Actions
Security Tools
•	Secret Management: HashiCorp Vault
•	API Security: OAuth 2.0, JWT, API Gateway (Kong/Ambassador)
•	Certificate Management: Let’s Encrypt with cert-manager
•	Vulnerability Scanning: Snyk, OWASP ZAP
Service Communication Patterns
Synchronous Communication
•	API Gateway ↔ Services: REST APIs with JSON
•	Service-to-Service: gRPC for internal communication
•	External APIs: REST/GraphQL for client applications
•	Health Checks: HTTP endpoints with circuit breakers
Asynchronous Communication
•	Event Streaming: Kafka for high-throughput events
•	Message Queues: RabbitMQ for reliable message delivery
•	Event Sourcing: Transaction events for audit trails
•	Pub/Sub: Redis Pub/Sub for real-time notifications
Data Management
•	Database per Service: Each service owns its data
•	Event Sourcing: Complete audit trail for transactions
•	CQRS: Separate read/write models for performance
•	Saga Pattern: Distributed transaction management
Resilience Patterns
•	Circuit Breaker: Prevent cascade failures
•	Retry Logic: Exponential backoff for failed requests
•	Bulkhead: Isolate critical resources
•	Timeout Management: Prevent hanging requests