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Economy
Mahesh

26/06/22 07:26 AM IST

Card Tokenisation

In News 
  • RBI had extended the credit and debit card tokenization deadline by three months, to September 30, 2022. 
Card Tokenisation 
  • Card information that is saved by a payment gateway and a merchant in order to complete future purchases is known as "card-on-file," or CoF.
  • Credit and debit card data is transferred millions of times daily throughout the payments industry.
  • To complete each of these transactions, cardholder information and extra payment details are needed; this sensitive credit and debit card information needs to be protected in order to safeguard customers, retailers and banks.
  • Users must provide their card information, including the card number, name, expiration date, and three-digit CVV, each time they make an online payment with a debit or credit card.
  • The platforms used by the merchant save these card details using masking and other security procedures.
  • Credit and debit card tokenization is the process of replacing sensitive data with a token, a randomly generated, one-of-a-kind placeholder, from the company's internal network.
  • In order to provide a higher level of protection for both the customer and the business, this token is used to access, retrieve, and maintain a customer's credit and debit card information.
Significance 
  • Debit and credit card information were exposed on merchant websites in a number of previous hacking incidents. Through card tokenization, the RBI plans to make things more secure.
  • Since the card won't need to be punched in for any purchases, card tokenization will facilitate transactions and speed up checkouts.
  • Users are able to save a digital copy of their card on their smartphone thanks to card tokenization. Therefore, it is unnecessary to carry a physical card.
  • Many believe that credit and debit card tokenization is the need of the hour as this will revolutionize card security.
Source- Live Mint 

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