Why Your Company Needs Payment Tokenization
It goes without saying that the security of your customers’ data is incredibly important. Yet when transmitting their information – perhaps when they are making a payment – you have to rely on the varying security of all the multiple systems which that data passes through before reaching its destination. The possibility for fraudsters to intervene at the weakest stage of the chain is real and it’s something over which you have very little control.
However, one of the most effective ways to make your data worthless to criminals is payment tokenization. It may sound complicated, but the way tokenized payments function is actually brilliant in its simplicity. Essentially, important confidential data points such as an account number are coded as a lengthy alphanumeric string, known as a token. The source data is then stored in highly secure ‘token vaults’ and this makes the token itself worthless to anyone who intercepts it as they won’t be able to interpret it.
In the process, not only does Payment Tokenization make payment transfers more secure, it helps ease the process and create trust between companies and customers. It reduces risk and helps drive the uptake of a ‘mobile wallet’ experience like Apple Pay. Here are some of the benefits payment tokenization can bring to your company today –
Less Red Tape
If you’re a business that accepts credit and debit cards, you’ll need to be compliant with the needs of regulatory bodies aiming to reduce the unnecessary retention of sensitive data. Tokenization helps you do that because that data – names, account numbers, etc – never touches your system in the first place. If your payment technology vendor offers tokenization as part of the payment processing service, you reduce red tape and remain compliant.
The incredible amount of data that can be scraped from credit or debit cards makes them particularly attractive to criminal groups. Insecure systems that house sensitive data are targeted by hackers who aim to profit from it. Payment tokenization stands between you and the thief because once that private data is encrypted, it’s no longer there to steal. Less risk for your customers, less risk for your business.
Because payments made with tokenization technology are faster and more secure, it continues to drive innovation. Purchases using Apply Pay or Google Pay that are made on a phone or watch feature tokenization. So do in-app purchases, in-store POS, or payments on the go. This technology has improved customer experience and in turn, it drives consumer confidence by making a purchase experience easier, safer, and more readily available than ever before.
Customers want to know their data is safe and secure whenever they shop. They will not risk it falling into the wrong hands. Tokenization demonstrates your commitment to the security of their data and in return, they demonstrate their trust in your business through increased loyalty. With all this in mind, it is crucial that you speak with your payment provider to ensure your business has enabled Payment Tokenization.