How RBI’s debit-credit card tokenization protect you from fraud?

How does RBI’s debit-credit card tokenization protect you from fraud?

On October 1, 2022, the debit-credit card tokenization system was initially implemented by the RBI. This was done in an effort to cut down on the number of cases of fraud use and misuse of credit cards and debit cards. The debit-credit card tokenization system’s objective is to reduce the incidence of fraudulent activity in online banking while simultaneously enhancing the safety of financial dealings conducted over the Internet.

In spite of the fact that the system has been put into place, a great deal of information regarding it is still lacking. What exactly is meant by the term “tokenization,” and what applications will this technique have? Do you have to stand in a certain line at a certain location in order to get a token? 


What debit-credit card tokenization System is?

To put it another way, it is the process of making payments without disclosing any personal information about the customer. After the new rule goes into effect, the information pertaining to your credit card and debit card will be saved in the form of encrypted tokens whenever you make payments with these types of cards online or within an app, or when you swipe these cards at point-of-sale machines.

You might be wondering what is going to happen with the older details. The Reserve Bank of India (RBI) has stated that as of the 30th of September in the year 2022, retail establishments will be required to delete the debit and credit card information of their customers.

If you have not given your consent to have your card tokenized, every time you make a payment online, in addition to providing the card verification value, also known as the CVV, you will be required to provide all of the information that is associated with your card, including your name, card number, and expiration date.

It will be necessary for the payment service to supply an alternative code because it is unable to save any of your information at this time. These tokens are going to be one of a kind, and the same token can be used for multiple different cards.

How RBI's debit-credit card tokenization protect you from fraud?
How does RBI’s debit-credit card tokenization protect you from fraud?

How will debit and credit cards be tokenized?

There is not much complexity involved. In only six easy steps, this can be accomplished without leaving the convenience of your own home. There is no need to wait in line for wine. You can get it immediately.

  • You are required to visit the website or download the app of your choice. You can decide which type of service or product you want to buy.

  • When you are checking out, choose the option to pay with a credit or debit card, and then enter the card’s CVV code.
  • You will be presented with the option of reading either “RBI Guidelines on Secure Your Card Age” or “RBI Guidelines on Tokenize Your Card Age.”
  • Your one-time password (OTP) will be sent to the email address and mobile number that you provided during registration. Entering the one-time password finishes up the transaction.
  • After you have successfully saved, you will be presented with the option to generate tokens. Make your selection from among these options. After this, the token will be generated, and rather than storing your card details, the website/app/payment service in question will store the token instead.
  • When you revisit the same website or app, you will notice that the final four digits of the card are now associated with the same token. You will find that the use of these four digits is helpful when making the payment of your choice.

What will change with debit-credit card tokenization?

The Reserve Bank of India claims that the implementation of debit-credit card tokenization will result in an enhanced payment experience for cardholders as well as an increase in the level of security afforded to debit and credit card transactions. It is anticipated that the new system will result in a decrease in the number of fraudulent activities of this kind.

According to the Reserve Bank, at the present time, e-commerce websites, merchant stores, apps, and other similar platforms store the details of customers’ debit and credit cards. If these details were to become public, it could lead to customers being defrauded.

Under the new system, the information pertaining to your credit card, including the card number, expiration date, and CV number, will no longer be stored, which will make it less likely that someone will commit fraud.

      The RBI initially implemented the debit-credit card tokenization System on October 1, 2022. This was done in an effort to reduce the number of credit card and debit card fraud incidents. The goal of the debit-credit card tokenization system is to reduce the occurrence of fraudulent activity in online banking while also improving the security of financial transactions over the Internet.

What method will be used to tokenize debit and credit cards? This can be done in six simple steps from the comfort of your own home. There’s no need to queue for wine. You can obtain it right away. Instead of storing your credit card information, the website/app/payment service will keep the token.

The Reserve Bank of India claims that implementing debit-credit card tokenization will improve cardholders’ payment experiences. The information associated with your credit card will no longer be stored under the new system. This reduces the likelihood of someone committing fraud.

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