New debit card, credit card tokenization rules from July 1; this is how it will affect you
The RBI has asked all merchants to remove customer debit and credit card data from their records.
The coming month of July will bring changes to the way you use your debit card and credit card. People who shop online keep their passwords and debit and credit card details secret. However, as the rate of online fraud has increased lately, it is important to keep this information safe as it can lead to huge financial losses. Therefore, in order to make online payments more safe and secure, the Reserve Bank of India (RBI) has requested all merchants and payment gateways to remove sensitive customer details from debit card and debit card. credit that are registered on their side. From July 1, online merchants will no longer be able to store customers’ credit and debit card details and the card tokenization rule will come into effect.
What are the new credit and debit card rules and what will you need to do?
From July 2022, when you make the first payment to any merchant, you will be required to provide your consent with an additional authentication factor (AFA). Once you do, you will make the payment by entering your CVV and OTP debit card or credit card.
What is credit card and debit card tokenization?
The word tokenization refers to replacing an actual card number with an alternate code that will be converted into a token. Tokenized card data may be used instead of an actual card number for future online purchases, as instructed by the card user. A tokenized card is safer than actual card details for making payments and sharing them with online merchants.
When using tokens, you do not need to provide details such as card number, expiration date, CVV, etc., as is required during debit/credit card transactions.
How to get a tokenized card?
You can get the card token by initiating a request on the bank’s website or app through the token requester. Once you make the request on the token requester, the merchant will send the request directly to the bank that issued the Credit Card / Visa/ Mastercard / Diners / Rupay. The party that receives the token request from the token requester will create a token linked to the card, the token requester and the merchant.