In India, cashless payments are growing in numbers very fast. Majority of the cashless payments are done via Credit, Debit or ATM cards digitally over the internet. But putting your card details on online websites and various apps may become the reason of serious financial loss. Considering this fact, The Reserve Bank of India has told card payment providers to develop and provide a tokenised service which can put a stop on revealing user’s card details in various platforms, website or apps provided by companies. So, in this article, we will talk about the whole tokenisation system and how it will help to secure the card transactions.
What does Tokenisation Mean?
You may have heard this word for the first time. Do not worry! We are here to describe it fully. Tokenisation is a process where the details of a card (such as Credit, Debit or ATM card) gets encrypted to a single unique token which can be used to keep the card details private and unreadable by third parties. Only the set party will be able to decrypt the token to process and fulfil the requested transaction.
How Tokenisation will Secure Card Payments?
As of now, when we need to pay somewhere online using our cards, be it an online shopping website or be it a mobile recharge app, we simply put our card details such as 16 digit card number, name on the card, expiry date and CVV code on the service provider’s platform.
Then the details can be stored by the service provider on their database to make future transactions seamless. But what will happen if somehow the service provider’s database gets hacked or leaked? Then our card details will get compromised, and that data can be used for the various harmful act.
But the tokenisation system will add an extra layer of security on our card details which we use in our daily life. Tokenisation process will generate a unique token by encrypting our card details so that unwanted parties cannot read them or use them to know our actual card details. Only the required party will be able to decrypt that token to finalize the transaction. This way, we do not need to enter our card details in various places to pay online. Even to perform card transactions in contactless mode at POS terminals like MOPAD POS, Quick Respons code payments like Bharat QR, etc. we can use unique token. We shall be able to generate a token and use it in various places to consume products or avail services from providers.
What is Token Requestor App and its Role?
We are not very clear about how the token requestor apps will come out. They may become available for download and install on mobile, and they will just take your card details and generate a unique token key by encrypting all the details. Generally, these apps will be launched by the card networks. Later on, this unique token key can be used on different platforms instead of actual card details to make digital transactions without revealing the card details. Once we see the more clear picture on the same, we will include it here in this article.
A cardholder can avail of Tokenisation services by registering their card on the token requestor app. You have to provide card details to register on the app, and the registration will be done through Additional Factor of Authentication (AFA). You will also find the option to register/ de-register your card.
Open your Token Requestor App, and you will be able to generate/ create Token instead of your 16-digit debit/ credit card number to make payments. The token ID will keep changing with every single transaction so that third-party can’t store your actual card number. A customer doesn’t need to pay charges for availing Tokenisation service.
So, what do you think about tokenisation? Will a unique token help us to prevent card details theft and leaks? Are you interested in using this new feature once it comes? You can know more about this service from RBI notification. Please let us know your views on the same in the comment section below.