What is tokenization?
A token itself does not have any value or meaning, it is a reference or identifier that, thanks to the tokenization system, allows you to return to sensitive data. Token Migration Platform Development is used to prevent data theft in bank card transactions. Tokenization is not just a buzzword in the digital payments industry. With the multiplication of payment methods available , it is vital to add an additional layer of security to protect sensitive credit card data.
When tokenization is activated, an algorithm generates a random and unique value that substitutes the buyer’s account number (or PAN number). This random value is the token. These tokens pass securely through the network to proceed with payment without exposing bank card details. The card number is protected in a secure vault. Chip cards were created to protect banking information at points of sale. Both systems prevent data from being stolen.
How does tokenization work?
Payment tokenization creates a random and secure ID, which makes no sense outside the system. If the user sends his data again, Blockchainx the token will be different. Tokens are generated in real time and used in predefined environments or domains. For example, the same card generates a token for use within a specific environment, and another for e-commerce transactions. Tokenization does not slow down the payment process as the tokens are generated in real time.
Using a token instead of a PAN number to finalize the payment makes it more secure. The seller only saves the token in its database for future transactions. If the database were to be compromised by a hacker, the tokens would be of no help to him.
If you want to store bank data and not tokens in a system, you need to comply with PCI DSS requirements, which is not that simple. The use of tokens allows you to delegate this responsibility to the payment gateway of your choice. Banking entities request compliance with PCI (Payment Card Industry) requirements to secure digital transactions.
The basic tokenization process occurs as follows:
- At the time of checkout, the buyer enters their card details in the payment form provided by the payment gateway .
- The card data is collected by the payment gateway that transmits it to the server within the iframe, and returns a token to the client. An iframe allows you to include part of a website belonging to another domain and guarantees the security of the user who enters their data.
- The tokenization server sends a response and the token is sent to the seller’s payment system.
- The seller processes the payment with the token that represents the bank details of the buyer.
- At MONEI, we include tokenization in all our plans .
We offer two types of tokens:
Single Use Token — This is a token used to complete a payment. The user enters their bank details in the form and we convert this data into a temporary token, only valid for one transaction and with a lifespan of five days.
Payment Token- You can request a permanent token thanks to our API. When the transaction is complete, you will receive the token in response, which represents the buyer’s bank details. It does not expire and is not linked to a specific transaction, and will allow the user not to have to enter their data again for future transactions.
