What Does Tokenization Mean for Payment Security?

Tokenization is taking the ecommerce industry by storm- but what is it and why should we be more aware of its benefits both for merchants and their customers?

Ecommerce companies especially, are now eager to use to tokenization for payment security as well as to provide additional benefits for the customer.

The threat of cyber-attacks is present more now than ever before and therefore enhancing the security of payments is at the top of every merchant's priorities. The story more than often seems to be; hackers were able to gain access to payment data that was 'safely' stored. The key to solving this issue is to eliminate all types of payment data from ever entering the merchant's network, this often is achieved by using a payment outsourcer. With the use of PCI DSS compliant tokenization solutions, cardholder data never even exists in your own systems.

So what exactly is Tokenization?

Tokenization is a method of data security whereby sensitive payment card data is converted to non-sensitive equivalents, called 'tokens'. When the cardholder data is sent to the merchant, it is passed through a hosted platform where the tokens are created. Only the token digits ever enter the merchant environment. When the data reaches the PSP the token data is matched with the cached card information and converted back to card data.

If for example, a cyber-attacker finds the tokens, the information found is of no value. Tokenization is an effective process that ensures sensitive cardholder data is kept safe, by completely eliminating payment data from ever reaching the merchant and all its environments. Implementing tokenization allows you to reduce your integration and complexities of PCI DSS compliance. Today's PCI DSS standards mean intricate certification and infrastructure for businesses that want to retain credit card details. Tokenization minimises the cost associated with these regulations, as merchants never see the customer's credit details and therefore can never store them.

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Posted by admin at 11:40 AM on Jun 12, 2017

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