Till now we have to enter 16 digit card number, card expiry date, CVV and OTP at the time of transaction. Transaction PIN is also required to be provided. Now all this information will not have to be given. Now a code will be received from the card network for the details of the card, which will be called a token.
The Reserve Bank is going to implement a new rule of online payment by credit and debit cards from next year. Banks have started informing their customers about this new rule. According to the Reserve Bank, to make online payment more secure, the Reserve Bank is bringing or rules. The name of this new rule is tokenization.
The Reserve Bank has asked merchant and payment gateway companies to remove the data of customers stored on its platform. For this, now the encrypted token will be used while doing the transaction. The new rule is going to come into effect from January 1, 2022.
HDFC has written in the message sent to its customers, applicable from January 1, 2022. HDFC Bank card details will be deleted on the merchant website or app. The Reserve Bank has made this rule for the security of the card. According to the new rule, merchants will not be able to store the information of the card on their website. RBI has directed all companies in the country to remove the saved information related to debit and credit cards by January 1, 2022.
what is tokenization
Till now we have to enter 16 digit card number, card expiry date, CVV and OTP at the time of transaction. Transaction PIN is also required to be provided. Now all this information will not have to be given. Now a code will be received from the card network for the details of the card, which will be called a token. This token will be special for each card. No information will be given through this token.
what will happen next month
- Will give a card for purchase from a merchant
- Merchant will start tokenization. He will take your consent for the tokenization of the card
- Once consent is received, the merchant card will send a token request to the network.
- The card will generate a network token containing the duplicate information related to the card. Will send this information to the network merchant
- Next time you pay with another merchant, the same process will be followed.
- Merchant will save your token and next time he will not have to generate token from card network
- Next time you will be able to transact with CVV and OTP
What will be the benefit out of this
Your card information entered in the token will be fully encrypted. This will reduce the chances of any fraud. Right now when we give the card to the merchant, there is a risk of leaking the information related to the card. Password and CVV are prone to theft. Such a thing will not happen in the token because all this information is encrypted or in code in it. No one will be able to read it. It will be used for payment only. With this, there is a preparation to make card payment more secure and convenient. You will not need to remember the 16 digit card number for the transaction. Just have to enter for the first time and from next time it will not happen. Once your information is saved with the merchant, there will be no need to provide any separate information.