With the card tokenisation deadline of September 30, 2022 set by the Reserve Bank of India (RBI) fast approaching, you should know about the benefits of tokanising your debit and credit cards.
Here is what experts say about the benefits of tokenisation:
Protecting sensitive data
“Digital transactions have taken over the entire payment ecosystem. One of the concerns that is accompanied with this rapid growth is safety and security of data, in terms of the sensitive card information provided by the user. To tackle this, RBI came up with the very vital solution of tokenisation, through which one’s sensitive card information can be replaced with a non-sensitive uniquely generated code called ‘Token’. Tokenisation comes in as the right move to keep customer data safety as the priority. It also ensures quick checkouts and convenient card management for the end user,” said Vikas Garg, Co-founder & CEO, Paytail.
OTP based Transactions
“Tokenisation as a technique is a reform that will go a long way in enhancing the security of online transactions. Now while consumers enter all the card details on merchant’s website, they receive an option “secure your card as per RBI guidelines”. Consumer has to opt for this option to generate a token,” said Amit Kumar, Chief Technology Officer, Easebuzz.
“Meanwhile, the customer will receive an OTP on the mobile device or email from the card issuer. The OTP is entered on the bank page and the card details are sent for transaction authorisation and token generation,” he added.
Creating Safer Digital Payment ecosystem
“I see tokenisation to be striking a perfect balance between data security and user experience. The RBI guideline on tokenisation mandates masking of sensitive credentials such as 16-digit card numbers, names, expiry dates, and codes with a unique alternate card number ‘token’. Easebuzz is enabling several merchants with tokenisation infrastructure that facilitates seamless checkout experience to their customers,” said Kumar.
“With the increasing adoption of digital payments, it is important that we safeguard the customers’ data and make transactions seamless. Hence the RBI mandate for card-on-file tokenisation is a step in the right direction. It has put the focus on building a robust ecosystem where consumers experience more secured transactions and merchants can benefit from better transaction approval rates. In India, tokenisation is a fundamental shift which requires all the stakeholders in the payments ecosystem – acquirers, issuers, card networks, banks, fintechs etc. to unite and ensure a seamless and secure digital payment solution,” said Rishi Chhabra, Country Head and General Manager, India and Sri Lanka, Fiserv.
Higher transaction approval rates
“Taking into consideration increased use of digital payments, the Tokenisation mandate by the RBI is a step in the right direction. Enabling a secured digital payments experience, it not only enhances consumer’s payment experience but also aids in higher transaction approval rates for merchants. At Pine Labs, we were one of the first big fintech players to announce compliance to erasure of Card-on-File data and a switch to tokens for storing debit or credit card details. Having processed 70 per cent of online volumes via tokens, we are working to solve for omnichannel merchants such as hotels, travel, and endless aisle in retail,” said Tanya Naik, Head of Omnichannel, Pine Labs.