New Delhi: Tokenization System: July brings some big changes for all credit and debit card users. The Reserve Bank of India has announced the introduction of tokenization of card transactions from July 1, 2022. According to the RBI, tokenized card transactions are considered more secure. This is because the online payment original card details are not shared with the merchant during the process. Tokenization is the replacement of the original description of a card with a token. Which will be unique for card combinations. Token Requestor accepts requests for card tokens from customers and sends the card to the network. The original card data, tokens and other related information are stored in secure mode through the official card network. Primary Account Number (PAN) i.e. Credit and Debit Card Token cannot be collected from the description request. Card network is also required to authenticate token requests for security.
What are the benefits of tokenization?
Any online payment made with a token card is designed to protect users from fraudsters. This is because the original card details are replaced by a token when sharing Card Details with the merchant during any transaction. From July, the online payment token will be unique to each card, token user and merchant. Previously, credit or debit cardholders used to save their card details on merchant sites when making any online payment. Because, it was convenient to make the payment.
But, by saving the card details online, the fraudsters steal the details. To counter such online payment scams, the RBI implemented a token system. No card tokenization required. If no token system is selected, users will have to enter all the details each time to complete the online payment by the end of June. Card tokenization is free.
How to get a tokenized card?
You can get the card token by requesting through the token requester on the bank’s website or app. Upon requesting the token, the merchant will send the request directly to the credit card issuing bank (Visa / MasterCard / Dinner / Rupee). The party receiving the token request from the token requester will create a token. Which will be related to Token Requestor and Merchant.