Tokenization may seem like the buzzword of the moment, but what does it really mean? This term has grown in popularity as a result of its association with mobile payment applications, including Google Pay and Apple Pay. In simplest terms, tokenization is what makes a payment more secure with these apps. This will protect your sensitive credit card data, ensuring that you get peace of mind when using these apps. Reading on, you can learn more about payment tokenization as well as the benefits it offers.
Tokenization is really a process for protecting all of your most sensitive data, including your credit card data, and placing this data with a number that is algorithmically generated. This number is known as a “token”. In many cases, this tokenization process is needed to prevent credit card fraud. When it comes to credit card tokenization, the customer’s PAN (primary account number) is replaced with a series of numbers that has been randomly generated. In this case, the randomly generated numbers are called a token. The tokens are then used to pass through both the internet and the wireless networks that are required to process payments.
What does this mean? You can complete these payments without worrying about your financial information being breached. Your account information is safe in a token vault. The whole point of tokenization is to protect your financial information and make sure it doesn’t end up in the hands of those who want to steal this information to use or sell. The chip in your credit cards protects your data when using your physical card, while tokens protect your cards when using it online.
Benefits of Credit Card Tokenization
What are the benefits of credit card tokenization? We’ve already discussed the biggest benefit of credit card tokenization: security. This benefits both the consumer and the businesses. Businesses can benefit because the consumer will feel safer when using your site to purchase items, which means people will be more likely to purchase from your brand. Consumers can feel free to buy the items they want online, with more confidence that their financial data is secure. Our secured virtual gateway uses Tokenization to rescue cardholder data from the previous transactions without having to store or secure it. The token can be used for subsequent transactions without the cardholder data being re-entered.
Tokenization is also beneficial to businesses because it helps ensure that the merchants are in compliance with PCI DDS standards. In many cases, merchants struggle to comply with these standards, which means they are subject to costly fines should a data breach happen. Thanks to tokenization, you can comply with these standards, without incurring high security and liabilities expenses. Because your customer’s information is tokenized, you minimize the risk of suffering from a data breach since there’s no credit card information on your network. You can also use tokenization to offer even more security for your customers, such as protecting their passwords and addresses.
Tokenization is an important thing when it comes to securing online payments. With the number of incidences where credit card data can be made vulnerable and stolen, it’s important for consumers to make sure that their credit card data is safe. By understanding tokenization, you can see why this is a trusted way to make payments through popular mobile payment apps. Please note this is only some information on payment tokenization. For more information please call us at: 310.826.7000