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Banks, ePay companies up tokenisation efforts to avoid turmoil

June 17, 2022

Banks, ePay companies up tokenisation efforts to avoid turmoil
Indian banks and payment aggregators are pressing ahead with plans to tokenize cards and exploring ways to route digital payment transactions through these tokens in a bid to ensure that card-based transactions are not affected from July 1, multiple people aware of the matter have told ET.

Tokenisation is a process by which card details are replaced by a unique code or token, allowing online purchases to go through without exposing sensitive card details.

As per the Reserve Bank of India’s latest order, all merchants must delete customer debit and credit card data on or before June 30 and replace card payments with unique tokens for all online, point-of-sale, and in-app transactions.

The move by banks and aggregators follows a representation made to the Reserve Bank of India (RBI) under the aegis of the Indian Banks’ Association to extend the deadline by the next six months, the people added.

The RBI, which is undecided on a deadline extension, recently said that more than 160 million tokens had already been issued.

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