Tokenization is the technique of replacing sensitive data (such as a credit card number) with a one-of-a-kind code or token that keeps all of the necessary details without risking its security. Why are e-commerce apps asking users to save their credit and debit card information again? Mainly due to the notion that RBI’s tokenization is currently in force effective from October 1, 2022.
The RBI has implemented tokenization to stop fraud. Compared to prior systems where credit card details were stored in databases and freely transferred over networks, tokenization makes it harder for hackers to access cardholder data. To protect your data, you can generate a token number by entering your card information, OTP, and CVV. Based on the information provided by the government in parliament in the financial year 2020–2021, the amount of fraud involving debit, credit, and the internet increased to Rupees 63.40 CR. According to orders from the Reserved Bank of India, all merchants are required to remove client debit and credit card information and replace it with a special token for all online purchases. There are three parties involved: banks, payment options, and merchants. Your card and transaction information will however remain in the possession of the banks and payment processors, but online merchants will be required to delete all of the information and only use the token number. Tokenization can now effectively protect customer data against cyber attacks from third parties.
How can you tokenise your card?
Below steps to be followed for card tokenisation:
If your card details are already saved on merchant website/app
Step 1: Visit the merchant website or app
Step 2: Go to the payment/checkout page, click on checkbox to secure your card Step 3: Complete Rs 2 refundable transaction with OTP to tokenize your card
If your card details are not saved on merchant website/app
Step 1: Visit the merchant website or app
Step 2: During checkout, enter card details
Step 3: Click on checkbox to secure your card
Step 4: Enter OTP to tokenize your card
Tokenizing several cards is possible for various online platforms. Different token numbers will be assigned to the same card for various online platforms. The token number won’t be used again. Tokenization is not mandatory; one can still fill up cards’ data manually each time.
Difference between tokenization and encryption
- Encryption: – Transforms plain text into ciphertext using an encryption algorithm and key
- Tokenization: – replaces sensitive data with a randomly generated token value
- Encryption: – Structured data such as payment cards, and unstructured data, such as entire files and emails
- Tokenization: – Structured data such as payment cards, social security numbers, etc
- Encryption: – Data can be exchanged with a third party or recipient who has the encryption key
- Tokenization: – Exchanging data is difficult since it requires direct access to a token vault mapping token value
I believe that in order to increase the security of your card information and protect yourself from frauds without sacrificing the enjoyment of online shopping, we should all learn how to tokenize our cards.
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