A study by Datacredit Experian revealed that more than half of people worldwide have been victims or know someone who has suffered identity fraud. The tokenization of digital cards is not just a trend, but a key security solution that allows users and financial institutions to perform transactions without compromising their data.
The digitization of purchase and immediate payment processes is now a constant in the global marketplace, driving the financial sector to increase current security standards.
Tokenization of digital bank cards is a technology that replaces sensitive card data, such as the PAN number, with a unique identifier or “token”. This token allows transactions without revealing the original card information, increasing security and reducing the risk of fraud..
Tokenization of digital cards: maximum security
Tokenization and traditional encryption are processes to protect sensitive information on financial digital cards. Tokenization replaces sensitive data, such as the cardholder, CVC2 and PAN, with a token, which acts as an alias for this information. This token is the one that travels during transactions, instead of the original data. Encryption, on the other hand, takes that sensitive information and, through a cryptographic process and the use of keys, secures the data without replacing it.
Although both methods provide security, in tokenization it is the token that guarantees the total protection of the process, traveling from the acquirer to the franchisee during the transaction. This method overcomes vulnerabilities and constant threats.
To prevent the reuse or compromise of tokens, stringent security measures are implemented. Franchises such as Visa y Mastercard ensure that each token issued is uniquely linked to a BIN, user, card and device, using cryptographic mechanisms that protect the tokens in secure vaults.
In addition, the lifecycle of the tokens is managed: if a customer tokens several cards in a digital wallet, each one is assigned a unique token, which ensures its use without blockages in various platforms, such as Amazon or Uber. If the same card is registered at another merchant, a new token will be generated, always ensuring secure and exclusive transactions for each merchant.
How digital bank card tokenization works:
- BIN designation: the issuing bank selects the BINs (either credit or debit) it wishes to tokenize and communicates them to the franchise (Visa, Mastercard, etc.) so that the associated cards are candidates for tokenization.
- Customer request: when the customer enters his card number in a digital wallet, that request comes to the franchise through a tokenization service provider (TSP).
- Validation of the BIN: the franchise verifies whether the BIN entered corresponds to the list previously provided by the bank.
- Card validation: if validation is successful, the tokenization solution connects with the bank to verify that the card is valid, current, not blocked and belongs to the cardholder.
- Token assignment and activation: the franchise assigns a token to the card, and the tokenization solution notifies the bank.
- Use of the digital card: from that moment on, the customer will use his card to make transactions in a secure way, instead of using the card number directly.
For tokenization management on platforms such as Apple Pay, Google Pay or Samsung Pay, this begins when the issuing bank requests the platform, for example Google, to enable its wallet for its cardholders, specifying the corresponding BINs. At the same time, the bank initiates a project with the franchisee, either Visa or Mastercard, and notifies them that it has a TSP. With these elements aligned, the tokenization process can be activated, ensuring secure transactions on these platforms.
The security of a tokenized digital card not only protects sensitive information, but also offers other important benefits. First, it ensures that only one token travels during transactions, avoiding exposure of sensitive data and protecting the user. In addition, improve the customer experience by allowing the tokenized card to be used in several digital wallets without risk of blocking, facilitating its use in different platforms. And finally, tokenization complies with PCI-DSS security standardssecurity standards, ensuring that transactions are carried out in accordance with current regulations.
Tokenization of digital bank cards is essential to safeguard sensitive information, thus minimizing the risk of fraud in transactions.. Intexus, as a specialized tokenization provider, ensures that every transaction is carried out with high security standards, providing protection and confidence for both users and businesses.