In a workshop organised by Mastercard today, the companyhighlighted the benefits of the adoption of card-on-file (CoF) tokenization that is set to make credit and debit card-based payments on e-commerce platforms such as Amazon, Netflix, and Zomato, safer and more convenient. To safeguard consumers from cyber and financial fraud cases, the Reserve Bank of India (RBI) mandated the adoption of card-on-file (CoF) tokenization of card transactions, as an alternative to storing cards on servers of e-commerce merchants. The new regulations will come into effect starting 1st July 2022 and will ensure a safe payment checkout experience for all consumers.
By tokenising their card details, consumers can continue to enjoy the checkout experience they have today. The merchant websites and apps will only be able to store the card issuer’s name and the last four digits of the card number. Hence, if any unauthorized person or hacker gets access to the token, they will not be able to use it. The process of tokenization will be based on consumers’ consent and the ones who do not opt for it would have to manually enter the details like card number, expiry, etc. every time to make an online payment. The sensitive information about consumers’ debit and credit cards will only be with issuer banks and their networks, like Mastercard.
Post the deadline, the consumer will have to enter their details once, in order to convert them into tokens. An OTP-based authentication would be required for creating a token. Tokenisation also provides consumers withaccess to new features through whichthey can reach out to their issuer bank and view all the saved tokens at various merchants and can suspend/unsuspend/delete them without having to visit the individual merchant app or websites. To comply with the guidelines and provide a seamless payment experience, Mastercard hasonboarded major payment aggregators such as Juspay, Paytm, PayU, Razorpay, and Google Pay.Since the extension in December 2021, the overall industry has made significant progress and around 160mn tokens have been created across networks, including Mastercard.