In the present day scenario of online purchases and rampant use of UPI, your credit or debit card transaction can expose you to varied risks of hacking, data breach and financial frauds, be it phishing, skimming, CNP (card not present) frauds. But technology today offers you an extra layer of protection in the form of tokenisation. Lets understand what it means, its mechanics, benefits and application in your daily transactions.
What is tokenisation?
Tokenisation technology replaces your credit and debit card details with a unique digital identifier, a “token.” This token is used in transactions instead of your actual card details, ensuring payment security across various platforms. Whether shopping online, using a payment gateway, or making contactless payments, these tokens are the unsung heroes safeguarding your financial data.
It is not mandatory to tokenise your credit or debit card. But it is advisable because it serves as a protection for your card details. Let us see how.
Benefits
Tokenisation for credit cards is like giving your card a digital mask. It is a smart way to keep your card information safe every time you use it, especially online. Here’s how it benefits you:
Safe to use: Imagine your card details as a secret code. Tokenisation changes this code into something else every time you pay. Even if someone gets this new code, they can’t use it, keeping your actual card details safe.
Easy to use: Even with all this security, your payments are still fast and simple. You won’t notice any difference - it’s like normal shopping, but safer.
Use it everywhere: Whether you’re buying a new game online, shopping for groceries, or even paying with your phone, tokenisation works in all these places. It’s like a universal safety net for your card.
No need for physical card: Once you complete the tokenisation of your credit or debit card you don’t need to use the physical card every time you need to make an online transaction. Since your card details are saved in a secure manner, you are spared the hassle of keying in details for every transaction.
Process of registration
Registering for credit card tokenisation is a straightforward process, it typically involves selecting the tokenisation service on the merchant’s payment page, choosing your card issuer, and authenticating the request through an OTP or your banking app. Once registered, the tokenisation solution securely stores your card details, replacing them with a token for future transactions.
Limits
There’s no limit to the number of cards you can tokenise. This flexibility allows you to enjoy the benefits of tokenisation across all your cards, ensuring a uniform layer of security and convenience.
How to tokenise with an online merchant
Selecting the tokenisation option: While making a payment at an online merchant, look for an option to tokenise your credit card. This is usually found at the payment or checkout page where you enter your card details.
Entering credit card details: If you are using the tokenisation feature for the first time with a merchant, you need to enter all your credit card details. Rest assured, this information is used only for creating the token.
Authenticating the process: After entering your details, you all undergo a verification process. This might involve an OTP (One Time Password) sent to your registered mobile number or email, as per the RBI’s secure practices.
Generating the token: Once verified, the merchant’s payment system will generate a token in place of your actual credit card details. This unique token will be used for your future transactions with that merchant, ensuring that your real card details are not stored or transmitted, thereby reducing the risk of fraud.
Confirmation of tokenisation: After the token is generated, you will receive a confirmation from the merchant. From this point onwards, each transaction you make with this merchant will use the token, not your actual card details.
Token management: Most online merchants and payment gateways allow you to manage your tokens, giving you the flexibility to remove or add tokens as per your preference. It is a simple, one-time setup for each merchant, enhancing your card’s security for future transactions.
Enable on UPI: You can also enable credit card tokenisation once you have linked your credit card to a UPI app. This will ensure security of your credit card on the UPI apps.
Conclusion
Tokenisation guidelines introduced by RBI have paved the way for more secured storage of card details while maintaining the same ease of checkout with no need to enter 16 digits each time. Embracing tokenisation for your credit card transactions is a smart move towards safeguarding your financial data in this digital age. You are getting enhanced security, seamless transactions, and peace of mind to make your financial security a priority.
(The writer is President & Head - Cards and Payments, Axis Bank)