token Tag

As customers’ financial behaviors evolve to include digital banking and financial technologies—like peer-to-peer payment, virtual currency, mobile payments and mobile wallets—tokenization is one of the most important new technologies merchants can leverage to stand in the way of cybercriminal access to customer payment information. What is Tokenization? It is recommended that consumers use a paper shredder to destroy bank account statements, checkbook registers, tax forms, payment receipts and similar documents that include sensitive data because any account number reflected on the document that wasn’t destroyed beyond recognition could be used fraudulently. Similarly, when a shopper buys something online, they are required to divulge confidential and sensitive information, such as their address and ATM card info.  Giving out this information online is risky since it may be stolen and used fraudulently. Much like a paper shredder renders account information meaningless so that it’s made nearly impossible to re-assemble, repurpose or identify, the same theory applies to tokenization—through technology. Basically, tokenization is the process of replacing sensitive data with unique identification symbols that capture all the vital information about the data without compromising its security. The algorithmically generated number used to replace the sensitive data is called a token. How It Works Typical consumer credit/debit (ATM) cards come with names, 16-digit personal account numbers (PANs), expiration dates and security codes — any of which can be "tokenized." When a merchant swipes a customer's credit card, the PAN is automatically replaced with a randomly generated alphanumeric ID (“token”). The original PAN never enters the merchant's payment system; only the token ID does. The merchant can use this special token ID to keep records of the...