Tokenization: Translating the Language of Hi-Tech
Written by Admin on April 24, 2019
The word may sound like hi-tech jibberish. And, oddly enough, that’s a good description for what it does. Tokenization is the process of replacing sensitive data––such as debit and credit card numbers––with a random, unique string of symbols that have no real meaning.
It’s a way of providing extra security for your payment information, basically by disguising it, as your data moves through the complex payment processing system. The “token” (or jibberish symbols) are worthless to thieves because they can’t be decoded. The system helps protect both individuals and merchants from data breaches, which are all too common in today’s world.
For those of you who use a smartphone––and that’s virtually everybody––tokenization is one of the things that allows you to safely make purchases using your phone’s mobile wallet. When making a purchase, your card numbers are “tokenized,” and the payment is processed without your bank details ever being exposed.
It’s also particularly helpful for subscription-based purchases which happen monthly or annually, because a merchant can store your undecipherable “token,” rather than your actual card information. Plus, each token is only valid with one merchant, safeguarding your information even further.
Simply put, tokenization is a behind-the-scenes process that translates your sensitive data into a secret language that can never be decoded. Thing is, you’d never even know it was happening. But rest assured, next time you think about using your mobile wallet, it’s good to know a system is at work keeping your data safe.