The Reserve Bank of India has decided to extend the scope of tokenisation to several consumer devices including laptops, desktops, wearables like wristwatches and bands, and also Internet of Things (IoT). The initiative is expected to make card transactions more safe, secure and convenient for the users.
Until now, the facility was available only for mobile phones and tablets of interested cardholders.
Tokenisation aims at improving the safety and security of the payment system. It refers to the replacement of the actual card details with a unique alternate code called the ‘token’. A tokenised card transaction is considered safer as the actual card details are not shared with the merchant during transaction processing.
RBI, on January 9, 2019, had permitted authorized card networks to offer card tokenisation services to any token requestor, subject to certain conditions.
There has been an uptake in the volume of tokenised card transactions in recent months. On a review of the framework and keeping in view stakeholder feedback, RBI, in a communication to the CEOs/presidents of all authorized card networks, has conveyed the decision to extend the scope of tokenisation.
