There is no doubt that there is a huge increase in digital and online payments. It has been moving quite rapidly northwards and the growth of telecommunication technology has certainly helped in more ways than one. These methods of payments have literally transformed the way in which buying and selling of products and services happen across the world. While it has made life easier for many of us, it also comes with its own challenges and problems. The number of online frauds has also increased quite alarmingly and there have been instances where millions of dollars worth of customer’s monies have been siphoned off by online fraudsters.
It Could Improve Security By Quite A Few Notches
Hence there is a burning and immediate need for coming out with some other solutions by which it is possible to ensure that the transactions are safer and also reliable. This is where the role of token payment systems might come into play. This technology is still in its early stages but it does hold out quite a lot of promise. Hence we thought it fit to list down some finer points about tokenization of digital online payments to improve safety and security of customer details such as bank account, credit card numbers, balance available apart from ensuring that there is no fraudulent siphoning off of funds when the data and information travels from the buyer to the seller and again from the seller to the credit card service provider.
How Does It Work On The Ground
This is a simple but highly effective technology from the customer standpoint. When the buyer gets into an online buying transaction, instead of his PAN or primary account number being used, tokens will be used. In other words, the details of the customer account number, credit card details, the amount of the order, and other sensitive details will be encrypted by way of a tokenized number. This number will travel from one end to the other. Hence the details will not be visible to the middlemen who handle crucial and sensitive information. All they will be able to see is the encrypted, randomized numbers and a whole lot of sensitive information will be stored in the encrypted wallet.
What Does The Future Hold
It would be also pertinent to mention here that these are still very early days for the entire token payment systems and it will take some time before the entire thing falls in place. There are some serious issues pertaining to the entire platform and architecture as far as these token payment systems are concerned. These and other issues need to be ironed out and the customers also need to be educated about the obvious benefits of this form of online payment systems.
However, there is no doubt that the entire concept is so very brilliant and that it will not be something which will die a slow death. Yes, there are some issues and once they are sorted out it is expected that it will become one of the main breakthroughs for handling different types of risks associated with online digital payments. The very fact that it could reduce online frauds by around 25 to 30% is again something that one needs to bear in mind.