In light of various representations received from organizations in the sector, the Reserve Bank of India (RBI) has extended the deadline for tokenization of registered cards (CoF) by six months until June 30, 2022.
The changes “are expected to enhance the safety and security of card data while continuing the convenience of card transactions.”
âCard tokenization improves card security for the customer by reducing the risk surface,â said Ishan Sharma, vice president of business development at Juspay.
Tokenization has always been the future of card payments, he added.
âApart from that, there are also benefits such as better success rates through better visibility of issuers and better lifecycle management, as well as an improved user experience for customers. Tokenization has always been about it. future of card payments. We are pleased that the RBI has given the ecosystem a six month extension, this will give merchants and partners enough time to migrate all card payment flows to tokenization, âa- he declared.
The previous deadline for implementing card tokenization was December 31, 2021.
âDigitization provides innovative financial products and services to bank customers. It has helped improve customer service and delivery and has great potential. With digital playing this vital role, it is important that the customer is served in a secure environment with their privacy protected. Tokenization of cards is an important step for the regulator to achieve this goal. To implement an instruction, RBI must set a timetable, âsaid Arijit Basu, chairman of IMC’s banking and finance committee.
What is tokenization
As part of tokenization services, a unique alternate code is generated to facilitate card transactions. This involves replacing a 16-digit customer card number with an equivalent non-sensitive value, called a token. Essentially, this means that a customer’s card information will no longer be available to a merchant, payment gateway, or third party that today helps with digital transaction processing.
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