RBI approves introduction of card tokenization system from January 1, 2022
Nowadays most of the people are using online payment and online shopping. In such a situation, people share their information on many websites for online payment, due to which there is a fear of privacy insecurity. In such a situation, a good news has come out. In fact, from the new year, online payment is going to be more secure than ever as the RBI has approved the introduction of card tokenization system for online payment from January 1, 2022.
Let us tell you that according to this new facility, online payment will now be done through token system and under this you will not have to share your card number, CVV information for transactions. Instead, a token number will be generated. The biggest advantage of this will be that the cardholder’s information will not be stored with third parties. Let us tell you that there have been many cases where the user’s data has been leaked and he has to be a victim of fraud. RBI claims that tokenization will reduce such risk.According to the information received from RBI, this service is called CoFT (Permitting Card on File Tokenisation). In this, a 14-16 digit token will be issued to the customer, which will be linked to the customer’s card and the customer will have to give only this token information while making online payment. No information will be stored anywhere in this entire process, which reduces the chances of fraud.
Let us tell you that according to RBI, at present this facility is available only for mobile phones and tablets. Later it can be used through laptops, desktops and wearables (watch, band) and IoT devices etc.
Let us tell you that tokenization will not be mandatory in the initial phase. The consumer can use it as per his wish. User has to apply online to generate token for his card. Based on which the card company will generate free tokens. Along with this, it will also be able to use the token system for all payments made from his card or he will be able to generate tokens only for a particular transaction.
In such a situation, to deal with any dispute situation, RBI has allowed payment aggregators to store limited amount of data. For this, the last four numbers and name information of the card will be stored. Apart from this, there will be no other detail store.It is noteworthy that according to the annual report of RBI 2019-20 There has been an increase of 174 per cent in card and internet frauds. A total of Rs 195 crore was fraud during this period.