Tokenization is an important point that allows users to add a layer of security for sensitive data. Recently, a new word has appeared in the payment industry, the so-called tokenization. The sudden surge in tokenization, a process known as the future of card payments, is all about creating a secure environment for payments, making any kind of cyber fraud impossible. In a world where online fraud and cyber-attacks are constantly hampering the acceptance of digital payments, tokenization aims to add a layer of security to sensitive customer data and prevent online and digital data leakage. Given the novelty of the process, many card users are unaware of the development of card tokenization and how merchants and payment partners tokenize online card payment flows. With the help of tokenization, you have a real opportunity to significantly simplify complex processes and analyze exactly how data security vendors are changing the digital payments industry for the better.
The need for tokenization
Online payments are currently one of the most convenient and popular things that are actively used in the field of purchasing services on the Internet. Due to the increase in the frequency of online transactions, most people store their payment information on merchant websites. This means that payment partners have access to confidential financial information. To securely protect this important data and protect not only consumers but also merchants and banks, the tokenization process prevents merchants from storing bank and credit card information on their servers. Tokens are non-confidential, uniquely generated codes that prevent the occurrence of any cyber fraud when making numerous online payments. Tokenization means replacing existing card data with a unique code called a token. The tokenization request is performed by the cardholder using an additional authentication factor. Tokens generated by this algorithm allow payments to be made without revealing bank details, fully protect confidential information, and prevent any cyber fraud with cards.
Tokenization and its widespread use
The tokenization movement focuses on the need to create a strong and sustainable ecosystem where merchants and partners can handle all payment flows using tokenized cards. With many well-known card networks and issuing banks, Mastercard simplifies tokenization in a few simple steps. To offer its customers the best security features in an increasingly digital world, the brand has developed a digital activation service. This service allows you to set up and securely store your payment information on your mobile device. So when you shop with a tokenized Mastercard debit or credit card, you can enjoy an experience similar to traditional card transactions with greater security and convenience. Tokens during the tokenization credit card process can be renewed by the card issuer, they are automatically renewed at sellers. This significantly simplifies interaction with customers and significantly increases the success rate by reducing the number of failed transactions due to expired bank card information.
Key benefits of leveraging tokenization capabilities
Tokenization is primarily designed to combat online fraud and prevent any errors from occurring when making digital payments, tokenization has many key benefits. Some of them include the following points:
Enhanced security: Tokens generated automatically are specific to a particular merchant's card and represent overall security during card transactions. It eliminates the risk of storing card data online and offers the uncompromised convenience of storing token data on commercial websites. After tokenization, only the last 4 digits of the card can be displayed. When your card is exchanged, renewed, reissued, or renewed, you will need to regenerate your transaction tokens on the merchant's website.
Faster payments: With the tokenization process, you can pay much faster because you don't have to enter your card number every time you make a purchase. Register your card once and easily transact whenever you want in a completely secure environment.
Using tokens for payments provides the highest level of security.
Easy Card Management: With tokenization, you can also keep track of all tokenized cards and merchants.
No physical card required: tokenization allows you to store a virtual version of your card on your smartphone for those days when you forget to carry your wallet.
With the help of online payments, e-stores can offer their customers (buyers) different payment options that will help them move forward in the purchase process. It is important for consumers and merchants that payment systems ensure the security of financial transactions. Actively using electronic payments for online purchases is as secure as using online banking. Payment institutions that facilitate payment transactions are often supervised by the same institutions that supervise banks to ensure the highest security standards are met. Transaction security is also guaranteed by current legislation. From the point of view of security, the global standard (PCI DSS) created by payment institutions (Visa, Mastercard, etc.) to protect the personal data of cardholders and the payment instruments themselves is also important.
Protection of online payments from malicious cyber attacks
Cybercriminals are constantly trying to find new and often effective ways to break into bank accounts and steal money. Learn how to effectively protect yourself from cyber-attacks. Contact a trusted payment institution. A payment institution is an institution that provides financial services mainly to banks, clearing houses, and other authorized institutions. Their records are kept by the financial inspectorate, which confirms that certified companies meet all the strict, valid requirements for ensuring an adequate level of security. The presence of these companies in the register of payment service providers can be checked at any time using the search engine. You can also track the registration of authorized payment agents. Until now, checking the web address was enough to verify the authenticity of a payment institution. Many users feel safe when they see HTTPS and a lock icon. Today, such an overview is not enough.
Impersonating a payment institution is a very common method of extorting money from unsuspecting Internet users. Always check the website address and click on the lock. You may also want to make sure your financial institution has a valid PCI DSS certificate, which verifies its compatibility with major credit card payment systems. This standard confirms compliance with first-class safety standards. Protect your transactions. Reliable payment institutions process millions of financial transactions every day. Potential cases of fraud can be effectively detected by analyzing statistical data. Each of these actions increases the probability of detecting potential fraud and effectively neutralizing the actions of cybercriminals.
Every day, various payment institutions process tens of thousands of transactions and collect a large amount of data and valuable information. This allows them to effectively detect and combat fraud patterns. Security and fraud detection systems are also used by banks, so combining the services of banking institutions and payment providers makes it possible to effectively increase the security of transactions. The malware can create duplicate bank accounts by replacing pasted numbers with fake numbers identified by cyber criminals. Accordingly, you can get an account number through e-mail, the website of an online store, etc.
After entering the account number in the transfer field, it is necessary to confirm the correctness of the bank card number. Unfortunately, this may not be enough. Some versions of the malware display the correct account number in your browser and send a fake account number to your bank. Therefore, during the transaction, it is necessary to re-approve the SMS confirmation code (if it was sent by our bank). Unfortunately, that's not all. Cybercriminals have developed a system to hack phones and exchange text messages with banks. Therefore, for your security, after the third step, i.e. after confirming the transaction on the bank's website, you should check whether the account number is correct or not. It's also a good idea to use a fast online transfer provider if possible.
Do not use public hotspots
The connection between your browser and the bank's servers is encrypted, but you should be careful with the Internet resources you use. Some public access points are particularly vulnerable to attacks by cybercriminals (cafes, the public Internet, universities, etc.). What does a cyber attack look like? Cybercriminals create networks with neutral names. However, a cyber crook can change the content of the sent page. They change account numbers instantly, provide fake login forms and redirect site addresses to other servers without warning. Thus, in a moment of inattention, you can log into another website and share your sensitive data with cyber criminals. Check to who you gave your bank card number.
When you plan to use your card for online purchases, make sure you know who you want to share your valuable information with. Of course, using such information on questionable websites, such as pirated, or gambling, will cause problems. On the other hand, information leaks also occur in large companies. It is worth paying attention to the security of card transactions in advance. Some banks send you an SMS code that you enter during online payments (3D Secure service), and many of them offer the option of receiving informative SMS messages about completed payment transactions. You can also get a prepaid card that transfers only the amount you need per transaction. The card is not linked to the main bank account. Cybercriminals cannot use the data even if they know about it.
What to do if you have become a victim of cybercriminals? Most banks do not provide this information, but all transactions with VISA and MasterCard credit cards are subject to an additional guarantee to provide additional security if your card information is leaked and fraudulent transactions appear on your account. After filing a complaint with the bank, you will have to wait for a decision, but it is known that usually the decision is made in favor of the client. It's also worth checking whether transactions from other credit card payment providers can be reported this way. Some financial institutions allow certain additional conditions, but some of these complaints are not considered at all.
You can also benefit from additional security for transactions made using fast online transfers. In this case, the payment service provider, not the bank, provides the guarantee. This option is available if you have placed and paid for an order through a certain online store, but have not received the ordered goods. Today, hackers can attack anything, including businesses, individual users, and government agencies. Remember that the security of data stored on your network is your primary responsibility. It is important to know how to effectively protect your computers and the transactions on your network. Therefore, always pay attention to security rules, especially when paying online, so that you do not unknowingly become a target of cybercriminals.
Tokenization solutions to ensure the appropriate level of security
Tokenization is a service used by many payment institutions. Many bank customers associate it not with a payment card, but with a small device that generates a unique code to confirm a transaction through the bank's online transaction service. But with this key solution, you can significantly improve security and introduce completely new payment ideas. Regardless of the method used, experts consider tokenization the best solution currently available to protect bank card data and effectively increase the security of digital payments. This is possible by replacing sensitive data (for example, card numbers) with another sequence of numbers (a secure payment token). Therefore, card account data is inaccessible to hackers. Payment tokens can be assigned to specific devices connected to the Internet. This means that even if an unauthorized person obtains the token data, they cannot use it through another device (such as a computer or tablet).
Tokens can also be assigned to specific merchants (ideal for services that store cards in e-stores) or for specific uses. This means that tokens created for contactless payments will not work for online transactions. When a customer makes a tokenized payment, the token is used to process the transaction data instead of the card data. If the device on which the card is registered is lost or stolen, the token can be quickly and easily deactivated without the need to block the card from the user or the bank. This principle also works the other way around. This means that if a payment card is lost or stolen, users can continue to pay with devices that use tokenized cards while waiting for a copy to be issued. Tokens are deactivated without the need to block payment cards or other associated tokens on internet-enabled devices. This will allow you to continue using any other payment instruments you use.
