New Delhi, January 14: In order to prevent fraudulent transactions, the Reserve Bank of India (RBI) has introduced a new system called tokenisation that will protect details of debit and credit cards of customers. Under the tokenisation system, a credit or debit card holder will get a 16-digit unique code to make transactions or online shopping. Soon, all banks and credit card companies will start rolling out the tokenisation scheme.
Currently, a user needs to provide details such as the card number, the expiry date and the CVV code into a system for online transactions or in-app transactions. However, the 16-digit unique code will replace these sensitive details. Customers will be able to generate a token that will only be saved in the payment system for the payment to be released and the system won't be able to read your original card details. Online Bank Scams, Frauds & ATM Debit Card Conning On The Rise; Here’s How You Can Save Yourself From Being Duped.
Thanks to tokenisation, your credit and debit card details won't reach to other private systems. At present, one can generate a unique token for your credit or debit card using a mobile phone or a tablet to connect with your card provider. “For the present, this facility shall be offered through mobile phones/tablets only. Its extension to other devices will be examined later based on experience gained,” says the official circular issued by the RBI.
Customers won't be charged for generating the 16-digit code. These tokens can be used for payments for online transactions, in-app transactions, point of sale terminals, quick response (QR) code-based transactions, near field communication (NFC) and magnetic secure transmission (MST) transaction methods.
"All extant instructions of Reserve Bank on safety and security of card transactions, including the mandate for Additional Factor of Authentication (AFA) / PIN entry, shall be applicable for tokenised card transactions also," the central bank added.