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Openai·Software Engineer·Onsite - System Design / Architecture·Senior

SeniorPrefer not to say
Apr 2026

Summary

System design round at OpenAI for a software engineer role, focused entirely on building a payment processing service with exactly-once charging guarantees. Pretty brutal in scope, they wanted end-to-end architecture plus deep dives on idempotency and failure recovery all in one session.

Questions Asked (9)

Q1

Design a payment processing service that sits between a checkout flow and an external payment provider, ensuring cards are never double-charged even under retries, timeouts, and duplicate webhooks.

System DesignTechnical Trade-offsAPI & Integrations
Author's notes

This is the core prompt and it's a lot.

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AI HintsAI Generated

Suggested Approach

Start by clarifying requirements and constraints, then design an idempotent payment service with a unique idempotency key per payment attempt, persistent state machine, and exactly-once semantics. Explain how you handle retries, timeouts, and duplicate webhooks using idempotency, deduplication, and reconciliation, and discuss trade-offs like latency vs consistency.

Pro tip: Emphasize that idempotency keys must be generated by the client (checkout) and stored server-side with the payment record, and that webhook handlers must also be idempotent by checking event IDs. This shows you understand end-to-end exactly-once processing.

1. Clarify Requirements and Constraints

Ask about expected throughput, latency requirements, payment provider capabilities (e.g., idempotency support), and failure modes. Confirm that the goal is exactly-once charging despite retries and duplicate events.

2. Design Idempotent Payment API

Define an API where the client sends a unique idempotency key with each payment request. The service stores this key with the payment state and returns the same response for duplicate requests, ensuring no double charge.

3. Implement State Machine and Persistence

Model payment states (e.g., INITIATED, PENDING, SUCCEEDED, FAILED) and persist them in a database with ACID transactions. Use the idempotency key as a unique constraint to prevent duplicate processing.

4. Handle External Provider Interactions

When calling the external provider, pass an idempotency key if supported. On timeout, do not assume failure; instead, query the provider or wait for webhook. Use exponential backoff with jitter for retries.

5. Process Webhooks Idempotently

Deduplicate webhook events by storing event IDs and ignoring duplicates. Update payment state only if the event is new and matches the expected state transition, then acknowledge the webhook.

Key Points to Mention

  • Idempotency keys generated by the client and stored server-side with a unique constraint.
  • Persistent state machine with ACID transactions to track payment status.
  • Handling timeouts by querying the provider or waiting for webhooks instead of retrying blindly.
  • Deduplication of webhook events using event IDs and idempotent webhook handlers.
  • Reconciliation process to resolve inconsistencies between internal state and provider state.
  • Trade-offs between consistency, latency, and complexity (e.g., synchronous vs asynchronous processing).

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.

Q2

What clarifying questions would you ask before diving into this design, specifically around what 'exactly once' means and who is allowed to retry?

System DesignAdaptability & Ambiguity
Author's notes

I actually did okay here.

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AI HintsAI Generated

Suggested Approach

Start by acknowledging that 'exactly once' and retry permissions are ambiguous and need clarification. Then, systematically ask questions about the definition of exactly once (e.g., delivery, processing, or effect) and about who can retry (clients, servers, or both). Finally, tie your questions to how these choices impact system design decisions like idempotency, deduplication, and failure handling.

Pro tip: Demonstrate that you understand the trade-offs: exactly-once is often impossible in distributed systems, so clarify whether they mean effectively-once or at-least-once with idempotency. Also, ask about retry permissions to uncover potential security and consistency concerns.

1. Clarify the scope of 'exactly once'

Ask whether 'exactly once' refers to message delivery, processing, or side effects. This determines the level of guarantee needed and the mechanisms required.

2. Identify who can retry

Ask if retries are initiated by clients, servers, or both, and whether retries are automatic or manual. This affects idempotency keys, authorization, and rate limiting.

3. Explore failure scenarios

Ask about expected failure modes (network partitions, timeouts, crashes) and how the system should behave during retries. This informs the need for deduplication and transactional boundaries.

4. Discuss trade-offs and constraints

Ask about latency, throughput, and consistency requirements, as these influence whether exactly-once is feasible or if a weaker guarantee with idempotency is acceptable.

5. Confirm assumptions and next steps

Summarize your understanding and ask if there are any existing patterns or constraints (e.g., use of message queues, databases) that should guide the design.

Key Points to Mention

  • Definition of exactly-once: delivery vs. processing vs. effect
  • Idempotency and deduplication strategies
  • Retry permissions: client vs. server, authentication and authorization
  • Failure modes and error handling (timeouts, network issues)
  • Trade-offs between consistency, latency, and complexity
  • Existing infrastructure and constraints (e.g., message queues, databases)

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.

Q3

Walk through the API design and data model for a single charge, including the full lifecycle from checkout request to recorded result.

System DesignData ModelingAPI & Integrations
Author's notes

Went with a client-supplied idempotency key on the create endpoint and returning current charge state so callers can poll.

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AI HintsAI Generated

Suggested Approach

Start by clarifying the scope and requirements (e.g., payment provider, idempotency, failure handling) before diving into the design. Then walk through the API endpoints and data model, emphasizing the state machine and how each state transition is persisted. Finally, discuss trade-offs and edge cases to show depth.

Pro tip: Emphasize idempotency and exactly-once processing early, as these are critical for payment systems and demonstrate you understand real-world reliability concerns. Also, mention how you would handle partial failures and reconciliation.

1. Clarify Requirements and Scope

Ask questions to understand the payment flow: Is this for a single charge? What payment providers? What are the consistency and latency requirements? Are there idempotency and retry needs?

2. Design the API Endpoints

Define the RESTful endpoints for creating a charge, retrieving its status, and handling webhooks. Include request/response schemas, HTTP methods, and status codes.

3. Define the Data Model

Outline the core entities: Charge, PaymentMethod, Transaction, and their relationships. Specify key fields, indexes, and how to store state transitions.

4. Walk Through the Lifecycle

Describe the sequence from checkout request to recorded result: validation, idempotency check, payment provider call, state updates, and webhook handling. Highlight failure and retry scenarios.

5. Discuss Trade-offs and Edge Cases

Address consistency vs. availability, idempotency implementation, handling partial failures, and reconciliation with the payment provider.

Key Points to Mention

  • Idempotency keys to prevent duplicate charges
  • State machine for charge status (e.g., pending, succeeded, failed, refunded)
  • Webhook handling for asynchronous payment provider updates
  • Database schema design with proper indexes and constraints
  • Error handling and retry logic with exponential backoff
  • Reconciliation process to ensure consistency with external systems

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.

Q4

How do you design the idempotency mechanism end-to-end: key generation, storage, enforcement under concurrent duplicate requests, and propagation to the PSP call?

System DesignTechnical Trade-offsAPI & Integrations
Author's notes

This was the hardest part for me.

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AI HintsAI Generated

Suggested Approach

Structure your answer as an end-to-end pipeline: start with how the client generates and attaches an idempotency key, then explain server-side storage and enforcement under concurrency, and finally how the key propagates to the PSP to prevent duplicate charges. Emphasize trade-offs (e.g., key TTL, storage choice, failure modes) and tie it back to correctness and user experience.

Pro tip: Mention that idempotency keys should be generated client-side (e.g., UUIDv4) and stored with a unique constraint to handle races atomically, and that you must handle the 'in-flight' state to avoid duplicate PSP calls. Also note that PSPs like Stripe support idempotency keys, so you should pass the same key downstream to ensure end-to-end deduplication.

1. Key Generation

Explain that the client generates a unique idempotency key (e.g., UUIDv4) per logical operation and includes it in the request header. Discuss key format, entropy, and client responsibility.

2. Storage & State Management

Describe storing the key in a persistent store (e.g., Redis or SQL) with a unique constraint, along with request hash, response, and status (in-progress, completed, failed). Mention TTL for cleanup.

3. Enforcement Under Concurrency

Explain how to handle concurrent duplicate requests: use atomic operations (e.g., SETNX in Redis or INSERT ... ON CONFLICT in SQL) to ensure only one request proceeds; others either wait or return the stored response.

4. Propagation to PSP

Detail how the idempotency key is passed to the PSP (e.g., Stripe's Idempotency-Key header) to prevent duplicate charges if retries occur. Mention that the same key should be used for the entire operation lifecycle.

5. Failure Handling & Edge Cases

Discuss handling failures: if the PSP call fails, mark the key as failed or allow retry with the same key; handle timeouts and ensure idempotency across retries. Mention monitoring and alerting for duplicate attempts.

Key Points to Mention

  • Client-side key generation with UUIDv4 and inclusion in request headers
  • Atomic storage with unique constraints (e.g., Redis SETNX, SQL unique index)
  • Handling in-flight requests: locking or returning 409 Conflict with Retry-After
  • Storing request hash to detect payload mismatches and prevent key reuse with different data
  • Passing the idempotency key to the PSP (e.g., Stripe's Idempotency-Key header)
  • TTL and cleanup strategy to avoid unbounded storage growth

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.

Q5

The PSP call times out and you don't know if the card was charged. How do you resolve the unknown outcome without risking a double charge?

System DesignTechnical Trade-offsRoot Cause Analysis
Author's notes

Never re-issue a timed-out charge with a new key, use the same one or query the PSP for that key's status first.

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AI HintsAI Generated

Suggested Approach

Start by acknowledging the ambiguity and the need to avoid double charges. Explain that you would use idempotency keys and reconciliation with the PSP to determine the true state before retrying. Emphasize designing for exactly-once semantics and graceful handling of unknown outcomes.

Pro tip: Always generate a unique idempotency key per charge attempt and store it with the transaction record; this allows safe retries and reconciliation. Also, implement a reconciliation job that queries the PSP for the status of any pending transactions to resolve unknowns automatically.

1. Acknowledge the unknown state

Recognize that a timeout does not indicate failure or success; the charge may have been processed. Avoid immediate retry to prevent double charging.

2. Use idempotency keys

Ensure every charge request includes a unique idempotency key. If retrying, reuse the same key so the PSP can deduplicate and return the original result.

3. Reconcile with the PSP

Query the PSP's API for the transaction status using the idempotency key or a client-generated transaction ID. This resolves the unknown without initiating a new charge.

4. Implement a reconciliation process

Set up a background job that periodically checks the status of pending transactions and updates the system accordingly. This handles timeouts and other asynchronous failures.

5. Design for exactly-once semantics

Architect the payment flow to be idempotent and resilient, using techniques like outbox pattern, state machines, and retries with exponential backoff, to prevent double charges and ensure consistency.

Key Points to Mention

  • Idempotency keys to safely retry requests without duplicating charges
  • Reconciliation with the PSP to check the actual status of a transaction
  • Avoiding immediate retries on timeout to prevent double charges
  • Using a unique transaction ID for tracking and querying
  • Implementing background jobs for periodic reconciliation of pending transactions
  • Designing for exactly-once semantics in payment processing

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.

Q6

How do you handle duplicate and out-of-order webhooks from the PSP, and how do downstream systems like the ledger and fulfillment service receive the final payment result exactly once?

System DesignData ModelingTechnical Trade-offs
Author's notes

Webhook idempotency is make-webhook-handling-a-no-op-on-replay, which I got.

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AI HintsAI Generated

Suggested Approach

Start by acknowledging that webhooks are inherently unreliable and can be duplicated or out-of-order, so the system must be idempotent and event-driven. Describe a design where the PSP webhook is ingested into a durable queue, deduplicated using a unique event ID, and then processed to update the payment state and publish a single canonical event to downstream systems via an outbox pattern. Emphasize exactly-once semantics for downstream consumers through idempotent processing and transactional guarantees.

Pro tip: Mention that exactly-once delivery is impossible in distributed systems, but you can achieve effectively-once processing by making consumers idempotent and using a deduplication store with a unique constraint on event IDs. Also, highlight the importance of reconciling with the PSP's API to catch missed webhooks.

1. Idempotent Webhook Ingestion

Design an ingestion endpoint that validates the webhook signature, extracts a unique event ID (e.g., PSP's event ID), and stores it in a deduplication table with a unique constraint. If the event ID already exists, acknowledge and discard the duplicate.

2. Ordering and State Management

Use the event's timestamp or sequence number to handle out-of-order events. Maintain the current payment state and only apply updates if the event is newer than the last processed event, or use a state machine that ignores stale events.

3. Transactional Outbox for Downstream Events

Within the same database transaction that updates the payment state, write a canonical payment result event to an outbox table. A separate publisher process reads from the outbox and publishes to a message broker (e.g., Kafka) with at-least-once delivery.

4. Idempotent Downstream Consumers

Ensure ledger and fulfillment services consume events idempotently by checking a processed event ID store before applying changes. Use unique constraints or upserts to prevent duplicate side effects.

5. Reconciliation and Monitoring

Implement a reconciliation job that periodically queries the PSP for payment statuses and compares with internal state to catch missed webhooks. Monitor for duplicates, out-of-order events, and processing failures.

Key Points to Mention

  • Idempotency keys and deduplication store with unique constraints
  • Event ordering using timestamps or sequence numbers, and state machines
  • Transactional outbox pattern to atomically update state and publish events
  • At-least-once delivery with idempotent consumers for effectively-once processing
  • Reconciliation with PSP API to handle missed or delayed webhooks
  • Monitoring and alerting for webhook processing anomalies

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.

Q7

How would you extend this design to support auth-then-capture, voids, and partial refunds while keeping idempotency intact?

System DesignAPI & IntegrationsTechnical Trade-offs
Author's notes

Follow-up question, came fast.

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AI HintsAI Generated

Suggested Approach

Start by clarifying the existing design's idempotency mechanism (e.g., idempotency keys, request deduplication). Then extend it to handle multi-step payment flows by introducing a state machine for payment intents and using idempotent operations for each transition. Finally, discuss how to handle partial refunds and voids with idempotent APIs and event sourcing for auditability.

Pro tip: Emphasize that idempotency must be maintained across the entire lifecycle, not just individual requests, and propose using a unique idempotency key per logical operation (e.g., per capture attempt) to prevent duplicate charges or refunds.

1. Clarify the current design and idempotency guarantees

Ask or state assumptions about how idempotency is currently implemented (e.g., idempotency keys, request IDs, database constraints). This ensures you build on a solid foundation.

2. Model the payment lifecycle as a state machine

Define states (e.g., authorized, captured, voided, partially_refunded) and transitions. Each transition should be idempotent, meaning repeating the same request yields the same result without side effects.

3. Design idempotent APIs for each operation

For auth-then-capture, voids, and partial refunds, use idempotency keys scoped to the operation (e.g., capture_id, refund_id). Ensure that retries with the same key return the original response.

4. Handle partial refunds and voids with ledger/event sourcing

Maintain an immutable ledger of all financial events. For partial refunds, track cumulative refunded amount and prevent over-refunding. Voids should only be allowed in authorized state.

5. Address concurrency and consistency

Use optimistic locking or serializable transactions to handle concurrent requests (e.g., two partial refunds). Ensure idempotency keys are stored with unique constraints to prevent duplicates.

Key Points to Mention

  • Idempotency keys should be unique per logical operation and stored with the result to return on retries.
  • State machine transitions must be atomic and idempotent, with proper validation (e.g., cannot capture more than authorized).
  • Partial refunds require tracking cumulative refunded amount and preventing over-refund via database constraints or application logic.
  • Voids are only valid before capture; after capture, refunds are used instead.
  • Event sourcing or an append-only ledger provides auditability and helps reconstruct state.
  • Concurrency control (e.g., optimistic locking, unique constraints) is essential to avoid race conditions in multi-step flows.

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.

Q8

The PSP goes down for 10 minutes. How do you degrade gracefully and what are the correctness implications of queuing vs failing closed vs failing over to a second PSP?

System DesignTechnical Trade-offsAdaptability & Ambiguity
Author's notes

Genuinely interesting tradeoff question.

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AI HintsAI Generated

Suggested Approach

Start by clarifying the system context and defining what 'graceful degradation' means for the user experience. Then systematically compare the three strategies (queuing, failing closed, failing over) across dimensions like correctness, latency, and user impact, and propose a hybrid approach with safeguards.

Pro tip: Emphasize idempotency and reconciliation: no matter which strategy you choose, you need a way to detect and resolve inconsistencies after the outage. Mention that failing over to a second PSP is not a silver bullet—it introduces its own correctness risks like double-charging if not handled carefully.

1. Clarify the system and failure scenario

Ask questions to understand the payment flow, user expectations, and what 'PSP goes down' means (e.g., timeouts, errors, or partial failures). Define what 'graceful degradation' means in this context.

2. Analyze each strategy's correctness implications

For queuing, discuss risks of stale transactions, duplicate processing, and eventual consistency. For failing closed, highlight the guarantee of no incorrect charges but potential revenue loss. For failover, consider idempotency, double-charging, and reconciliation challenges.

3. Evaluate trade-offs and propose a hybrid approach

Weigh latency, user experience, and business impact. Suggest a combination: e.g., failover for critical transactions with idempotency keys, queue for non-urgent ones, and fail closed as a last resort.

4. Define monitoring and reconciliation mechanisms

Explain how you would detect inconsistencies, alert on failures, and reconcile transactions after the outage to ensure correctness.

5. Summarize and justify your recommendation

Conclude with a clear recommendation based on the specific context, emphasizing the balance between availability and correctness.

Key Points to Mention

  • Idempotency keys to prevent duplicate charges during retries or failover
  • Eventual consistency and reconciliation processes for queued transactions
  • User experience impact: latency, error messages, and retry options
  • Business impact: revenue loss vs. customer trust and regulatory compliance
  • Circuit breaker patterns to avoid cascading failures
  • Testing and chaos engineering to validate degradation strategies

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.

Q9

How do you detect and prevent double charges caused by a buggy client that generates a fresh idempotency key on every retry?

System DesignRoot Cause AnalysisTechnical Trade-offs
Author's notes

Caught me a bit off guard because it's a client-side bug but you have to defend against it server-side.

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AI HintsAI Generated

Suggested Approach

Start by acknowledging that idempotency keys alone are insufficient when the client is buggy, then propose a layered defense: server-side deduplication using business identifiers (e.g., order ID, user ID, amount, timestamp) combined with idempotency keys, and client-side fixes like persistent key storage. Emphasize detection through monitoring and reconciliation, and prevention through both client and server changes.

Pro tip: Mention that you would add a short-lived lock or unique constraint on a combination of business fields to catch duplicates even with different idempotency keys, and that you'd log and alert on such occurrences to identify buggy clients.

1. Clarify the scenario and requirements

Restate the problem: a buggy client generates a new idempotency key on each retry, causing duplicate charges. Ask clarifying questions about the system (e.g., payment processor, retry logic, existing idempotency implementation).

2. Detect double charges

Propose detection mechanisms: monitor for duplicate transactions with same business identifiers (user, amount, timestamp window), use reconciliation reports, and set up alerts for anomalies.

3. Prevent double charges server-side

Implement server-side deduplication using a combination of business fields (e.g., user ID, amount, currency, and a client-provided request ID) with a unique constraint or a short-lived lock. Also, consider making the idempotency key derived from request content rather than client-generated.

4. Fix the client and improve resilience

Advise fixing the client to persist and reuse the same idempotency key across retries, and add client-side safeguards like exponential backoff and retry limits. Also, consider API changes to enforce idempotency (e.g., requiring a client-generated request ID that is stable).

5. Discuss trade-offs and monitoring

Acknowledge trade-offs: server-side deduplication may add latency or complexity; strict uniqueness might reject legitimate duplicate requests. Emphasize monitoring and gradual rollout to catch issues.

Key Points to Mention

  • Idempotency keys are only effective if the client reuses the same key on retries; a buggy client defeats this.
  • Server-side deduplication using business identifiers (e.g., user ID, amount, timestamp) can catch duplicates even with different idempotency keys.
  • Use database unique constraints or distributed locks to enforce deduplication atomically.
  • Detection via monitoring, logging, and reconciliation to identify and alert on duplicate charges.
  • Client-side fixes: persist idempotency key across retries, use exponential backoff, and limit retries.
  • Trade-offs: potential false positives, added latency, and complexity; consider idempotency key derived from request payload.

AI-generated suggestions, not part of the candidate's original notes. May be inaccurate — verify before relying on them.