Visa, AMEX and
According to an
Aligned with these initiatives, the proposed standard would meet this consumer demand and allow the traditional account number to be replaced with a digital payment 'token' for online and mobile transactions. With a token, consumers will no longer be required to enter an actual account number when shopping online or on a smart device. Tokens provide an additional layer of security and eliminate the need for merchants, digital wallet operators or others to store account numbers.
To ensure consistency across the globe, the proposed standard used to generate tokens would be based on existing industry standards and would be available to all payment networks and other payment participants. Key elements of the proposed standard include:
- New data fields to provide richer information about the transaction, which can help improve fraud detection and expedite the approval process
- Consistent methods to identify and verify a consumer before replacing the traditional card account number with a token
- A common standard designed to simplify the process for merchants for contactless, online or other transactions
"For more than five decades, the payments industry has relied on standards to safely and consistently process payments," said
History of security collaboration
The payments industry has a long history of collaborating to develop the necessary standards that allow merchants and financial institutions to offer a consistent and secure payment experience, while providing consumers the confidence to shop anywhere, anytime.
"This continued transition from plastic cards to digital is all about providing consumers with the ability to make a purchase easily and safely. They would no longer need to store their actual card account number when shopping online or with a smart device; the token would serve as that stand-in," said
"By working together to form a common global standard for online and mobile shopping, we will be able to provide enhanced security, interoperability and consistency for all participants within the digital payments ecosystem," said
How it works
Once a standard is agreed to and implemented, issuers, merchants or digital wallet providers would be able to request a token so that an account holder would used the token to process, authorise, clear and settle the online transaction in the same way traditional card payments are processed today. Tokens can be restricted in how they are used with a specific merchant, device, transaction or category of transactions.
The development of a global standard will enable a new generation of payment products, while maintaining compatibility with the existing payments infrastructure. Key principles driving the development of a token standard for digital payments include:
- Ensuring broad-based acceptance of a token as replacement for the traditional card account
- Enabling all participants in the existing ecosystem to route and pass through the payment token
- Enabling digital wallet operators, mobile application developers and others to easily and securely develop innovative payment products
- Improving cardholder security with tokens that are limited for use in specific environments
The proposed framework has incorporated the input of many stakeholders, particularly card issuers and merchants. Over the coming weeks, the framework will also be presented to other partners and independent industry bodies, such as the Clearing House,
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