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Tokenization technology is slowly but surely taking over digital payments.
Mastercard continues to expand its efforts to eliminate the use of credit card numbers in online purchases in an effort to reduce online fraud. The company has already successfully replaced card numbers with so-called tokens that protect customer data.
According to Mastercard CEO Michael Miebach, the company now processes 1 billion transactions using tokens every week. For comparison, it took three years to reach the first billion such transactions.
Now, Mastercard plans to introduce new technologies that will replace traditional security measures, such as passwords, with biometric data such as fingerprints or facial scans. This is the next step in the fight against the growing threats of online fraud, the volume of which, according to analysts, will exceed $91 billion by 2028.
The CEO of Mastercard noted that in the past, passwords were universally relied upon to protect data and transactions. However, over time, this method became vulnerable, which required the search for new solutions.
Tokenization technology was first introduced by Mastercard and Visa about a decade ago, when fraudsters began stealing credit card information from retailers such as Target Corp. and Best Buy Co. Initially, the technology aimed to replace card numbers with tokens that could only be unlocked by payment networks, rendering them useless to hackers.
This system has proven to be highly effective in reducing fraud in in-store purchases, especially using services such as Apple Pay. However, now criminals have switched to online stores, where customers enter their card details manually.
In addition, scammers are increasingly targeting sites that use one-time passwords for security. These passwords, which retailers and banks send to customers to verify their identity, are becoming increasingly vulnerable, as Michael Miebach has pointed out.
Mastercard plans to work closely with banks and payment services around the world to replace one-time passwords with tokens based on users' biometric information. In India, the company has already implemented this service by partnering with PayU and banks such as Axis Bank Ltd.
Miebach stressed that the problem is that if data is leaked, fraudsters can use it for their own purposes. Tokenization, on the other hand, is designed to significantly reduce the risks of leaks and fraud in the digital economy. Mastercard plans to transfer all online transactions in Europe to a tokenization system by the end of the decade.
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Mastercard continues to expand its efforts to eliminate the use of credit card numbers in online purchases in an effort to reduce online fraud. The company has already successfully replaced card numbers with so-called tokens that protect customer data.
According to Mastercard CEO Michael Miebach, the company now processes 1 billion transactions using tokens every week. For comparison, it took three years to reach the first billion such transactions.
Now, Mastercard plans to introduce new technologies that will replace traditional security measures, such as passwords, with biometric data such as fingerprints or facial scans. This is the next step in the fight against the growing threats of online fraud, the volume of which, according to analysts, will exceed $91 billion by 2028.
The CEO of Mastercard noted that in the past, passwords were universally relied upon to protect data and transactions. However, over time, this method became vulnerable, which required the search for new solutions.
Tokenization technology was first introduced by Mastercard and Visa about a decade ago, when fraudsters began stealing credit card information from retailers such as Target Corp. and Best Buy Co. Initially, the technology aimed to replace card numbers with tokens that could only be unlocked by payment networks, rendering them useless to hackers.
This system has proven to be highly effective in reducing fraud in in-store purchases, especially using services such as Apple Pay. However, now criminals have switched to online stores, where customers enter their card details manually.
In addition, scammers are increasingly targeting sites that use one-time passwords for security. These passwords, which retailers and banks send to customers to verify their identity, are becoming increasingly vulnerable, as Michael Miebach has pointed out.
Mastercard plans to work closely with banks and payment services around the world to replace one-time passwords with tokens based on users' biometric information. In India, the company has already implemented this service by partnering with PayU and banks such as Axis Bank Ltd.
Miebach stressed that the problem is that if data is leaked, fraudsters can use it for their own purposes. Tokenization, on the other hand, is designed to significantly reduce the risks of leaks and fraud in the digital economy. Mastercard plans to transfer all online transactions in Europe to a tokenization system by the end of the decade.
Source
